Florida Retirees Could Be Missing This Big Money-Saving Opportunity
Written by
Gabrielle Olya
Edited by
Molly Sullivan
Commitment to Our Readers
GOBankingRates' editorial team is committed to bringing you unbiased reviews and information. We use data-driven methodologies to evaluate financial products and services - our reviews and ratings are not influenced by advertisers. You can read more about our editorial guidelines and our products and services review methodology.
20 Years
Helping You Live Richer
Reviewed
by Experts
Trusted by
Millions of Readers
Many retirees who are from states with temperate climates flock to Florida for much of the year to enjoy warm weather year-round. This can not only be beneficial to your retirement lifestyle, but to your retirement budget as well — if you take advantage of a key strategy: establishing Florida domicile.
If you split your time between Florida and another state, officially making Florida your legal home could unlock major tax savings and asset protections. Here’s how to establish Florida domicile — and why it could be worth thousands of dollars a year.
Who Can Claim Florida Domicile — and How To Prove It
To establish Florida domicile, you need to be able to show that Florida is where your life is truly based.
“Think about the everyday details that show where your real life happens,” said Rob Edwards, managing director and senior PIM portfolio manager at Edwards Asset Management.
That includes:
- Switching your driver’s license and voter registration
- Seeing a Florida-based doctor
- Receiving mail at a Florida address
- Taking your pet to the local vet
- Hiring local professionals
- Joining a local country club or community church
“These are all signals that your life is clearly centered here,” Edwards said.
Top Financial Benefits of Florida Domicile for Retirees
There are numerous financial benefits to making Florida your legal home.
No State Income Tax
Florida is a no income tax state, which could translate to major cost savings for retirees.
“Your Social Security, pension and IRA withdrawals are all state tax-free,” Edwards said. “Depending on where you’re coming from, that can add up fast. I’ve seen clients save thousands a year, just by getting this part right.”
No Estate or Inheritance Tax
Florida doesn’t impose estate or inheritance taxes, which can make a big difference for your heirs.
“If you’re passing down a $5 million estate in a state like New York, your family could lose hundreds of thousands of dollars to taxes,” Edwards said. “In Florida? That money stays with them.”
Homestead Exemption
If your home is your primary residence, you can qualify for a homestead exemption in Florida.
“This puts a cap on how much your property tax bill can go up, even if your home’s value jumps,” Edwards said. “It’s not something people talk about often, but over time, I’ve seen it add up for people who’ve put down roots here.”
Strong Legal Protections for Assets
Florida has some of the strongest legal protections in the country for your assets — things like your home, retirement accounts, annuities and life insurance.
“In many cases, those assets are off-limits to lawsuits or creditors,” Edwards said. “You never think you need that kind of protection, but if you do, it can make all the difference. It’s one of the reasons you see so many high-profile business leaders and celebrities moving to Florida — not just for weather, but to protect what they’ve worked hard to build.”
Beware: Why High-Tax States May Challenge Your Move
Even if you can prove that Florida is now your home, you may run into some roadblocks when you try to establish domicile.
“The part people often overlook is that the state you’re leaving may not let you go easily — especially if it’s a high-tax state,” Edwards said. “They may argue that you never left and can hit you with unexpected audits, double taxation and legal headaches you don’t want.”
The more your habits, relationships and professional ties are rooted in Florida, the stronger your case becomes.
More From GOBankingRates
