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In this video, Gunster real estate lawyer Eric Coffman explains how a person buying real estate in Florida may be liable for unpaid taxes on rental income received by the property owner – and a relatively simple way buyers can protect themselves.

Watch the video now (or watch it on YouTube):

Video produced by TheLaw.TV

Property buyers beware: Florida rental income subject to sales tax

Not everyone knows this, but a Florida property owner has to pay sales tax on the rental income the owner receives.

When you’re buying real estate in Florida, there’s a potential pitfall.

If the seller hasn’t paid that tax, then the buyer can be liable for any unpaid amounts.

There are, however, a few things that a buyer can do when the buyer is acquiring a commercial or residential real estate asset.

For example, the buyer could conduct a sales tax audit of the seller’s books and records – but that can be pretty expensive and time consuming.

A better approach is for the seller to provide what’s called a Certificate of Compliance from the Florida Department of Revenue, showing that all taxes have been paid.

It’s a pretty simple approach and can save a buyer from some potentially large and unexpected liabilities.


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