Florida has no state estate tax, but real estate still carries property taxes and transfer taxes
Florida does not charge an estate tax on the value of property you leave behind when you die. That is different from a property tax, which is an annual tax on land and buildings you own while alive, and different from a transfer tax, which some states charge when real estate changes hands. Florida charges both of those — but not an estate tax on real estate specifically.
This matters because it means your heirs will not owe a separate tax to Florida based on the value of the house or land you owned. However, they will still owe annual property taxes on that real estate once they inherit it, and if they sell it, they may owe a transfer tax depending on the county.
Key Takeaways
- Florida has no state estate tax, so your heirs do not owe tax to Florida based on the value of real estate you leave them.
- Property tax is charged every year on real estate you own, whether you are alive or dead, and heirs must continue paying it after they inherit.
- Some Florida counties charge a transfer tax when real estate is sold, ranging from 0.5% to 1.5% of the sale price depending on the county.
- The federal estate tax may still apply if your total estate exceeds the federal threshold, even though Florida has no state estate tax.
Annual property taxes on inherited real estate
When you inherit real estate in Florida, the property does not become tax-free. Your heirs will owe annual property taxes on the land and any buildings on it. The tax rate varies by county and is based on the assessed value of the property, not the price paid to inherit it.
Property taxes in Florida typically range from 0.7% to 1.1% of assessed value per year, though the exact rate depends on which county the property is in and what the property is used for. A homestead property (a primary residence) may may have access to for a homestead exemption, which reduces the assessed value and therefore the tax owed. Heirs can sometimes claim this exemption if they meet the requirements, but they must apply for it.
The assessed value of inherited property is usually set at the market value at the time of death, not the original purchase price. This means if the property has increased in value over many years, the new assessed value — and therefore the property tax — may be higher than what the original owner was paying.
Transfer taxes when real estate is sold
If your heirs sell the inherited real estate, they may owe a transfer tax depending on which county the property is in. Not all Florida counties charge this tax, and the rate varies. Some counties charge 0.5% of the sale price, others charge 1%, and a few charge 1.5%.
The transfer tax is paid at closing and is usually split between the buyer and seller, though the exact split depends on the county and what the purchase agreement says. Your heirs should ask the title company or real estate attorney handling the sale which county the property is in and what the transfer tax rate is, because it will affect the net proceeds from the sale.
This tax is separate from any federal capital gains tax your heirs might owe if the property has increased in value since you died. The step-up in basis rules may reduce or eliminate that federal tax, but that is a federal issue, not a Florida one.
Federal estate tax still applies to large estates
Even though Florida has no state estate tax, the federal government does charge an estate tax on estates above a certain threshold. For 2024, that threshold is $13.61 million per person. If your total estate — including real estate, investments, bank accounts, and other property — exceeds that amount, your heirs may owe federal estate tax.
This federal tax is owed to the Internal Revenue Service, not to Florida. The rate is 40% of the amount over the threshold. Most Florida residents do not have estates large enough to trigger this tax, but if you do, you should work with an estate planning attorney or tax professional to understand how it will affect your real estate and other assets.
The federal threshold changes each year and is set to drop significantly after 2025 unless Congress extends the current law. If you think your estate might be affected, it is worth reviewing your plan with a professional.
Homestead exemption and property tax breaks for heirs
If the real estate you leave behind is a primary residence in Florida, your heirs may be able to claim a homestead exemption, which reduces the assessed value used to calculate property tax. The exemption is worth up to $50,000 of assessed value, though the exact amount depends on the county and the property's total value.
To claim the exemption, your heirs must apply to the county property appraiser's office, usually within a set timeframe after inheriting the property. They will need to prove they intend to live in the home as their primary residence. If they do not live there, they cannot claim the exemption.
Some heirs also may have access to for additional exemptions if they are over 65, disabled, or a surviving spouse. Each county administers these differently, so your heirs should contact their county property appraiser to find out what breaks they might receive.
What happens if real estate is part of a trust or joint ownership
Real estate held in a trust or owned jointly with right of survivorship may pass to your heirs outside of probate, which can speed up the process. However, this does not change the tax situation. Your heirs will still owe annual property taxes, and if they sell, they will still owe any applicable transfer tax.
The advantage of a trust or joint ownership is procedural — it avoids probate court — not tax-related. In fact, real estate in a trust may not receive the same step-up in basis for federal capital gains purposes, so it is worth discussing with an estate planning attorney whether a trust is the right tool for your situation.
Frequently Asked Questions
Do I owe Florida estate tax on real estate I inherit?
No. Florida has no state estate tax. Your heirs will not owe tax to Florida based on the value of the real estate you leave them. However, they will owe annual property taxes once they own it, and if they sell it, they may owe a transfer tax depending on the county.
What is the difference between estate tax and property tax?
Estate tax is a one-time tax on the total value of everything you leave behind when you die. Property tax is an annual tax on real estate you own while alive. Florida charges property tax but not estate tax. The federal government charges estate tax only on very large estates.
Will my heirs owe federal estate tax on the house?
Only if your total estate exceeds $13.61 million (in 2024). Most Florida residents do not reach that threshold. If you think you might, talk to an estate planning attorney about strategies to reduce the tax burden on your heirs.
Can my heirs avoid property taxes by putting the house in a trust?
No. Property taxes are owed on real estate regardless of whether it is in a trust, owned jointly, or held individually. A trust can help avoid probate court, but it does not reduce property taxes or estate taxes.
What if the property is in multiple counties?
If you own real estate in more than one Florida county, each county will assess and tax that property separately. Your heirs will receive property tax bills from each county. Transfer taxes also vary by county, so if they sell property in one county, the rate may be different than if they sell in another.