The most significant change to the U.S. tax code in 30 years was approved by Congress and signed by the President just in time for Christmas 2017. Many of the provisions became effective January 1, 2018, only a few days after being enacted.
SO, WHAT DOES IT CHANGE?
Corporate and Pass Through Entity Income Tax: Permanent
Corporate Tax Rates are reduced from 35% to 21%.
Business Income from Pass Through Entities: provides for a 20% deduction for individuals and trust and estates on domestic qualified business income from pass-through entities.
Effectively reduces the top tax rate for those eligible to 29.6% (from 37%)
Wages paid to owners and certain income from specified services business (i.e. attorney and accounting firms) are excluded from the deduction.
There are many benefits to living in Florida other than the warm climate, beautiful beaches and tropical lifestyle. Did you know that Florida residents pay no state income tax or state gift tax? Aside from these perks, one of the biggest benefits is that only Florida residents may take advantage of Florida’s strong asset protection and homestead laws. With so many second homes and vacation homes taking advantage of the weather and beauty in our state, let’s discuss some of the real estate advantages of making Florida your primary residence.
First, Florida’s homestead law protects Florida residents from the forced sale of their home to satisfy a court judgment. This ensures that you cannot lose your home to creditors as long as you are a resident and it is your primary residence. There are no limits on the value of the property that can be protected.
Furthermore, real estate taxes are lower for residents due to the homestead exemption allowing Florida homeowners a deduction of up to $50,000.00 off their property’s assessed value. Another bonus is “portability” allowing residents to transfer their homestead exemption if they move.
Finally, Florida’s homestead laws also protect residents from large property tax increases. The Florida constitution places strict limits on the amount by which any reassessments of the taxable value of homestead property can increase. The annual increase of the assessed value of homestead property is limited to the lower of (i) the increases in the consumer price index or (ii) three percent (3%).