What Do You Keep From a Florida Rental? Expenses, Tax and a Worked Example
Short answer: You do not keep all of the rent. After property tax, insurance, HOA, management, repairs and empty months, what is left is often around half of the rent, and income tax comes on top. Below I go item by item with a sample $320,000 home, and there is a box where you can run your own numbers.
Investors ask me the same things: "If the rent is $2,500, what do I actually keep, how much is the tax, and can I bring the money home?" The numbers below are examples; every home has different taxes, insurance and HOA. The goal is to show which items exist and how big they are.
This page is general information, not tax, legal or accounting advice. For tax and company-structure decisions, talk to a CPA and an attorney who work with foreign investors in the US.
The main costs taken out of rent
- Property tax
- Paid to the county every year. An investment home does not get the homestead exemption that applies to a home you live in, so the bill is usually higher. The amount depends on the address and the county rate. Look up the exact figure on the county property appraiser's website.
- Insurance
- A rented home needs a landlord (dwelling) policy. Insurance in Florida is expensive and varies a lot with the age of the home, the roof and the area. Flood insurance may be a separate cost.
- HOA and CDD
- Many neighborhoods charge monthly or yearly dues. A CDD charge is added to the property tax bill. Ask about both before you buy. Some HOAs limit the length of a lease or require tenant approval.
- Property management
- Most owners abroad use a management company. It usually takes a percentage of the rent collected each month, and there may be a one-time leasing fee when a new tenant is found. Rates vary by company; ask for a written quote.
- Maintenance and repairs
- Air conditioning, water heater, roof, paint and cleaning between tenants. One year may be quiet and the next may bring a big bill, so set aside a percentage of rent each year.
- Vacancy
- The time between one tenant leaving and the next one starting. Do not assume the home will never be empty.
- Other
- Accountant and tax filing fees, international transfer fees, lawn care and pest control (if the HOA does not cover them), and, if you have a mortgage, loan interest and principal.
Example: a $320,000 home rented for $2,500
Assumptions: a cash purchase (no loan), a home in Hillsborough County, property tax of about 1.8% of the purchase price, insurance of $4,200, HOA of $100 a month, a management fee of 10% of rent collected, maintenance of 5% of rent and 5% vacancy a year. All of these are sample assumptions.
| Item | Per year | Per month |
|---|---|---|
| Rent ($2,500 x 12) | $30,000 | $2,500 |
| Vacancy allowance (5%) | -$1,500 | -$125 |
| Rent collected | $28,500 | $2,375 |
| Property tax (assumed 1.8%) | -$5,760 | -$480 |
| Insurance | -$4,200 | -$350 |
| HOA | -$1,200 | -$100 |
| Management fee (10% of rent collected) | -$2,850 | -$237.50 |
| Maintenance and repairs (5% of rent) | -$1,500 | -$125 |
| Net income before income tax | $12,990 | $1,082.50 |
So with $2,500 of rent on paper, about $1,080 a month is left before income tax. The net yield (cap rate) is about 4%, while the gross yield is 9.4%. The gross figure looks good, but what investors really look at is what is left after costs.
Two examples from real listings: two FishHawk Ranch townhomes
These two examples use figures from real townhome listings in FishHawk Ranch (the addresses are not shared). The price, property tax and HOA come from the listings. The rent ($2,500) and the insurance ($3,000) are my assumptions, not a market rent or an insurance quote. Both assume a cash purchase and no vacancy.
| Per year | Home A $295,000 | Home B $325,000 |
|---|---|---|
| Rent ($2,500 x 12) | $30,000 | $30,000 |
| Property tax (listing) | -$6,874 | -$4,805 |
| Insurance (assumed) | -$3,000 | -$3,000 |
| HOA (listed yearly fee) | -$125 | -$93 |
| Management fee (10%) | -$3,000 | -$3,000 |
| Maintenance and repairs (5%) | -$1,500 | -$1,500 |
| Net before income tax | $15,501 | $17,602 |
| Per month (before tax) | ~$1,290 | ~$1,470 |
| Net yield (cap rate) | 5.25% | 5.4% |
This table shows what I compare between two homes: price, property tax and rent. Home B's property tax looks low, and it can change when an investor buys, so the tax may rise. Neither listing states the monthly HOA amount, and insurance needs a quote. These figures are approximate and assume no loan: with a mortgage the payment comes on top and cash flow can turn negative. The real calculation should be done by a CPA who works with foreign investors.
Income tax
Florida has no state personal income tax. But rent from a US home can be subject to US federal tax even if you are a foreign owner. The method and rate that apply depend on the person, the home and any tax treaty, and the same home can differ by hundreds of dollars a month. That is why the figures above are shown before income tax. The after-tax calculation should be done by a CPA who works with foreign investors in the US.
Can I bring the money to Turkey?
In general, yes: the rent is paid into a US bank account and you can send it from there to your account in Turkey by international wire. Points to watch:
- Meet your US tax duties and filings first. Keep the lease and the management company's reports as proof of where the money came from.
- If you are a tax resident of Turkey, you may need to report your foreign rental income in Turkey too. A treaty between the US and Turkey exists to avoid double taxation; how it applies depends on your situation. Ask your accountant in Turkey.
- Banks may ask for source documents on large transfers. Ask your bank before you send.
What to know before you rent it out
- Short-term (Airbnb style) rentals can bring extra county and state taxes and HOA limits. They work differently from long-term leases.
- Renting through a management company is the least stressful way from abroad, but its cost goes into the calculation above.
- If you buy with a loan, the monthly payment is added to the list. You can use the investment mode on the calculators page for that.
Run your own numbers
The boxes are filled with the sample home. Type your own numbers and the result updates instantly.
This is an estimate. Actual tax depends on depreciation, treaties, your other income and the method you choose. Ask your tax advisor (CPA).
How we work
My aim is not to tell you "this home will make money". I listen to your goal (cash flow, a dollar-denominated asset, your own use) and we work out the costs and the rent estimate together on real listings. If a home does not suit you, I will say so plainly. The figures above are examples, not guarantees. I am not a tax or legal advisor: you make tax and structure decisions, such as an LLC, with your CPA and attorney who work with foreign investors.
Frequently asked questions
Is there state tax on rental income in Florida?
Florida has no personal income tax. US federal income tax still applies. Short-term rentals can also bring sales and lodging taxes.
How much is a management fee usually?
It varies by company. Often a percentage of the rent collected is taken each month, and there may be a separate fee when a new tenant is found. Ask for a written quote and what it covers.
How much tax does a foreign investor pay on rental income?
It depends on the person and the situation. Because the method and rate can make a big difference, have a CPA who works with foreign investors in the US work it out.
How do I send my rental income to Turkey?
Usually from your US bank account to your account in Turkey by international wire. Before that, meet your US tax duties, keep your source documents and check your reporting duties in Turkey with your accountant.
Related guides
- Florida Home Insurance and Property Tax
- What Are HOA and CDD Fees?
- Wiring Money and Closing Remotely
Let's run your investment numbers
Tell me the home or budget you have in mind and we will work out costs and expected rent in a short call.
Book a free consultationThis article is for general information only and is not legal, tax, lending, or insurance advice. Rules, rates, and timelines can change. Before you decide, speak with a loan officer, title company, attorney, or CPA. Nisa Esmer, Florida-licensed REALTOR® (License No. SL3665986), Elite Choice Home Group, Future Home Realty Inc.