Florida is one of seven states that do not impose a personal income tax on its citizens. Florida residents don’t pay inheritance taxes, gift taxes, or taxes on intangible personal property. In order to maintain the infrastructure and pay for public services, such as civil services and education, Florida residents pay more taxes on their properties, businesses, and in sales.
Taxes can be confusing to anyone, but Florida residents (especially those who own more property or a corporation) may find the tax landscape difficult to navigate. Because some Florida tax laws are mandated statewide and others are levied at the local level, it’s essential that residents familiarize themselves with specific area laws. Fully understanding the law will ensure you get the best tax return possible.
Types of Taxes in Florida
Like every state, Florida has its own laws concerning the way residents are taxed. To make matters more complicated, the law may differ depending on where you’re from. A qualified CPA can help you navigate local tax laws, but only if they’re familiar with the local landscape. So, for example, if you’re an Orlando resident, you’ll want to look into Orlando CPA firms because they will be the most qualified to handle tax laws specific to your community.
Sales tax – In Florida, counties are able to impose a surtax on top of the state’s regular 6 percent sales tax. Depending on where you live, this surtax may increase your sales tax ¼ percent to 2 ½ percent.
Use tax – If you bring property into Florida from another state, it is subject to a use tax. Although some property isn’t taxed (certain government property, religious property, etc.), most property is subject to a tax.
Property tax – Florida doesn’t differ from other states in this regard, although some communities may have higher property taxes than others. It all depends on where your home is located, its size, and its approximated value.
Corporate tax – Businesses are expected to pay a corporate tax in Florida, and this tax is calculated using the businesses’ adjusted federal taxable income.
Depending on where you reside in Florida, you may also be subjected to the following taxes:
- Fuel tax
- Local option tourist tax
- Convention development tax
- Lead-acid battery fee
- Communications services tax
- New tire fee
- Gross receipts tax
- Rental car surcharges
How to Get the Best Tax Return
Everyone wants to have a tax return that results in a large refund, or enough deductions to reduce what’s owed in taxes. The best way to ensure you have the outcome you want is to file the tax return correctly, and ensure there’s no errors within the return. This is best handled by a professional.
When you consider the repercussions of an incorrectly filed tax return, you’ll begin to understand the importance of CPAs and the role they play in filing your taxes. Financially, you could end up owing the state more than you can afford. Worse still is if you’re found guilty of avoiding tax law, tax evasion, or something else and then face jail time. Unless you’re fully prepared by experience to navigate your local tax laws, you should not engage in doing your own taxes.
No one really likes to spend their time considering tax law, but it’s something that’s entirely necessary. Like virtually everything else in life, you get the best results when you’re well-prepared. Instead of putting it off, start working with a tax professional to assess your situation now, and ensure you get the best possible tax return at the end of the year.