questions on property taxes in Sanibel and Captiva answered. How much
can I expect to pay? Plus tax implications for overseas investors
Questions often asked:
How much can I expect to pay in property taxes?
What are the special tax implications for foreign
owners of property in the United States?
What is a 1031 deferred tax exchange, and can I
take advantage of it?
How much can I
expect to pay in property taxes?
Property Taxes on Sanibel and Captiva and
Lee County are collected by the Lee County government.
They are paid in arrears and are assessed in October and due at the end
of March of the subsequent year. You can get a discount if you pay in
The millage rate last year for Sanibel property owners was 0.0186017.
This includes Lee County and City of Sanibel taxes. As a "ballpark"
estimate, a homeowner
can expect to pay approximately 1.5% of the purchase price of a home in
Residents who live full time in Florida can take advantage of the Save
our Homes amendment passed in Florida some years ago. This puts a cap on
increase in assessed value each year. For more information about
this and more on property taxes, click on
“frequently asked questions”
on the Lee County property appraiser’s site.
What are the special tax implications for foreign owners
of property in the United States?
You may own property in the
United States as an overseas investor, but there
are a few things you
will need to know when it comes to renting or selling.......
Law that all Non-US buyers should know about!
All property sales by foreign nationals are subject to a 10% withholding
at closing unless the seller and the Realtor have planned for this
problem. Similar rules apply to rental
income received. It is recommended that all foreign nationals who are buying or
selling property in the USA consult with US tax experts. We can provide
you with a list of registered
tax experts who can assist you.
A little planning can save thousands of dollars, prevent delays and
ensure that your closing goes smoothly.
What is a 1031 deferred tax exchange, and can I take
advantage of it?
Many people think about selling and
reinvesting into more income or investment property.
One would be
foolish not to do a tax-deferred exchange! If you sell and reinvest, you
will pay income taxes on the realized gain. However, if you call it an
you will pay no taxes. This means that more money is available
as leverage for acquiring your next properties. Look at it as a free
loan from the government!
Rules for a 1031 Tax Exchange
Real Property Use. Both your old and new properties must qualify as
investment or business use. If both properties pass this test, you can
exchange nearly any type of real estate.
2. 45 Day
Identification Period. You have 45 days from the closing of your sale to
list the properties you may want to buy. There are no exceptions to the
3. 180 Day Exchange
Period From the sale closing date, you have 180 days to close on the
purchase of one or more properties from the 45-day list. Again there
are no exceptions
to this deadline.
Intermediary (QI) The IRS mandates that you use a QI to prepare the
legal documents for your exchange. Because the QI must be independent,
it cannot be your friend,
employee, broker, or even your accountant or
attorney. The QI also holds your money, so that you do not have access
5. Proper Title
Holding. You must purchase and take title to your new property exactly
as you held title to your old property.
Requirement. To defer all of your capital gain tax, you must buy a
property equal or higher in value than the one you sold.
Also, you must
reinvest all of the cash proceeds from your sale.