Hi, I’m Bette Hochberger, CPA, CGMA. For today’s Miami Monday, I will discuss Miami’s tax laws for non-residents and what you need to know. Let’s jump in!

With its vibrant culture, beautiful beaches, and thriving business environment, Miami attracts numerous non-residents who visit or conduct business in the city. If you are a non-resident in Miami, it is essential to understand the tax laws that apply to you. 

So, let’s jump in and navigate the difficulties of taxation in the city. 

Understanding Residency Status

The first step in understanding Miami’s tax laws is determining your residency status. If you spend fewer than 183 days in a calendar year in Miami, you will be considered a non-resident for tax purposes. 

However, consulting with a tax professional to assess your situation and ensure accurate residency classification is important. If you want to learn more about moving domicile to Florida, click here.

Non-Resident Taxation on Miami-Sourced Income

As a non-resident in Miami, you are subject to taxation on income earned within the city’s boundaries. This includes income from employment, self-employment, rental properties, and business activities conducted in Miami. It’s important to report and pay taxes on this income to remain compliant with the tax laws.

Federal Tax Obligations

In addition to Miami’s tax laws, non-residents are also subject to federal tax obligations. The IRS governs federal tax regulations, and it is crucial to understand the impact of federal taxes on your non-resident status. 

Make sure to familiarize yourself with the rules and regulations provided by the IRS to ensure compliance and avoid any penalties.

Withholding Taxes

Miami requires non-residents to adhere to specific withholding tax rules. If you are a non-resident employee earning income in Miami, your employer is generally required to withhold federal income tax from your wages.

 Understanding the withholding tax requirements will help you estimate the correct amount of taxes to be withheld and avoid potential underpayment penalties.

Reporting Requirements

Non-residents in Miami must file an annual federal tax return using Form 1040NR or 1040NR-EZ, designed specifically for non-residents. File by the deadline, typically April 15th, unless an extension is granted.

Accurate reporting of your Miami-sourced income and any applicable deductions is crucial to avoid potential penalties or legal issues.

Deductions and Credits

As a non-resident, you may be eligible for certain deductions and credits that can help lower your tax liability. For example, you may be able to deduct business expenses incurred in Miami, such as travel costs directly related to your business activities. 

Exploring available deductions and credits can help optimize your tax situation and minimize your tax burden.

I hope you learned something new today. If you’re thinking about moving to Miami, schedule a meeting with me, and let’s talk more about the steps you will need to take.

As always, stay safe, and I will see you next time.