Real Estate


Florida businesses often hold real property and their business operations in separate entities for liability purposes. While this is a very standard and effective way to mitigate the liability risk of owning commercial real estate, these types of structures need to be mindful of the sales tax rules. Usually rental agreements are put in place between the operating entity (Lessee) and the real estate entity (Lessor) with rent either...

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The Opportunity Zone (OZ) Program was created as part of the Investing in Opportunity Act, which was included in the Tax Cuts and Jobs Act enacted in December 2017. The OZ program was created to encourage private investment in these communities in exchange for capital gain tax incentives. The goal is to use the estimated $6.1 trillion of unrealized private gains held by U.S. households. In exchange for investing in communities in...

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The Florida legislature voted to again reduce the sales tax, which is imposed under section 212.031, Florida Statutes, that commercial real estate owners charge and receive from tenants to 5.5 percent in 2020 from its current rate of 5.7 percent. Real property rentals subject to the reduced rate include commercial office space, retail, warehouses and certain self-storage units, excluding storage for motor vehicles, boats and aircraft....

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The Tax Cuts and Jobs Act (TCJA) tax reform added new tax code Section 199A, which created a 20 percent tax deduction possibility for you if your rental property: (a) has profits and (b) can qualify as a trade or business. The current tax law as now stands, with rentals that achieve trade or business status, you win. When you achieve the “business-status” rental property, it will create the following five possible tax benefits for...

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As commercial real property owners in Florida are likely aware, the Sunshine State imposes its sales tax on rental payments for the lease of real property. The general 6 percent state-level tax was reduced to 5.8 percent for 2018. The legislature passed a law to further reduce the state-level rate to 5.7 percent for occupancy periods beginning on or after Jan. 1, 2019. There is no reduction in the local option surtax that many Florida...

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