Ranked fourth among the wealthiest economies in the United States, Florida offers thriving environment for foreign nationals willing to invest in real estate. From apartments to ocean-front properties, there is a vast catalog of investment options available.
In this article, you will find a guide on foreign investment in Florida real estate.
Investing in Florida Real Estate as a Foreigner – The Primary Steps
US law does not restrict the ability of non-US citizens and non-residents to purchase real property. When you are neither a US citizen nor a permanent resident, immigration law considers you a foreign national.
In either case, it is possible to hold the title of property directly in your name or through a US company. It is not hard to find cases in which foreign nationals set up a limited liability company (LLC) or a corporation to hold the title of property for investment purposes.
It is fundamental to understand that simply purchasing a property in the United States does not affect one’s immigration status.
Foreign Investment in Florida Real Estate – Tax Implications
Owning Florida real estate as a foreign national requires an Individual Tax Identification Number (ITIN). The Internal Revenue Service (IRS) needs to keep track of federal tax reports filed by foreign nationals.
As foreigners do not qualify for a Social Security Number (SSN), they must apply for an ITIN with IRS. The US tax system can be overwhelmingly complex to understand without proper legal guidance.
Failing to comply with the pertinent rules may result in legal and fiscal liability. To avoid these unnecessary situations, the best approach is to work with an attorney to navigate this whole process smoothly.
Investing in Florida Real Estate as a Foreigner – Is it Necessary to be Physically Present in the United States?
Another important element involved in foreign real estate investment is whether the investor wants to travel to Florida to handle the transactions directly or prefers to stay abroad while using a legal advisor as a representative.
Investors who do not plan to be physically present in the United States can utilize a Power of Attorney (POA) to authorize a real estate lawyer to act on one’s behalf.
The negotiation process must also be a top priority, as it will define the terms and conditions of the transaction. Once the core contractual terms have been outlined, the party seeking to buy a Florida property may perform due diligence.
Real estate sellers must disclose certain information that may affect the property’s value. On the other hand, buyers must thoroughly assess each aspect of the property to identify the suitability of the deal.
When it is time to close the transaction, several documents must be handled with utmost attention to detail. The list of closing documents includes the deed of property, statements from both parties involved, affidavits, and many others.
As it is plain to see, the excuse of “saving money” on attorneys fees and trying to work one’s way through foreign real estate investment in Florida may result in a disastrous experience.