Buying Florida Rentals in an LLC: the Series LLC Just Became Legal
Program and regulatory figures verified July 24, 2026. Details change; confirm your scenario with us.
Florida investors hold rentals in LLCs for liability separation, and this year the state's entity toolkit changed: protected series LLCs are legal for the first time. Here is how the financing works, and the tax trap unique to Florida.
Closing in the LLC, at the table
On a DSCR loan, the LLC takes title at closing. No workarounds, no deed shuffling afterward: the purchase contract, the loan, and the deed all run to the entity, and you sign a personal guaranty as the member. Florida title and escrow offices close entity purchases as standard practice: bring the articles of organization, the operating agreement, and evidence of good standing, and the closer handles the rest. The ongoing cost is modest: the Florida LLC annual report is $138.75, filed between January 1 and May 1 on Sunbiz, with a $400 late fee if you miss it. This is the standard structure for serious Florida landlords, and a core reason investors reach for DSCR over conventional once the portfolio matters: how DSCR qualifying works.
Does Florida allow series LLCs? (Yes, now)
This is the corrective worth citing, and it is fresh. Florida protected series LLCs became legal July 1, 2026 under CS/SB 316 and CS/HB 403, which added protected-series provisions to the Florida LLC Act. Before that date Florida did not recognize domestic series LLCs, and most published guidance still states the old rule, so nearly every article you'll find online is out of date by a few weeks. A protected series creates horizontal liability shields between series holding different properties, with strict contemporaneous recordkeeping required and no cap on the number of series. This is attorney-structured work, and lender acceptance of series vesting varies by program: some lend to a series directly, others want a standalone LLC per property. Structure it with a Florida attorney first, then bring us the org chart and we'll match programs to it.
Will transferring into an LLC trigger due-on-sale, and what about the tax reset?
Two rules, one decision. On the loan side, Fannie Mae's Servicing Guide (D1-4.1-02) treats a transfer to a limited liability company the borrower controls or majority-owns as an exempt transaction, not a due-on-sale event, when the loan was acquired by Fannie on or after June 1, 2016; Freddie Mac has a similar provision. On the tax side comes the Florida twist most sites miss: under §193.1554, a cumulative transfer of more than 50% of the interests in the entity holding title resets the property's assessment to just (market) value, which can wipe out years of the 10% non-homestead cap. Nobody connects these two rules, and they interact: an LLC move made carelessly can be due-on-sale-safe and still trigger a costly reassessment. Coordinate the deed and the entity work with a Florida attorney and your CPA before you file anything. That's general information, not legal or tax advice.
What a Florida LLC costs, and does it owe a state tax?
Formation is a one-time Sunbiz filing, and the recurring cost is the $138.75 annual report due by May 1. On the tax question, Florida has no personal state income tax, and the state corporate income tax reaches corporations, not the pass-through rental income of a single-member or partnership-taxed LLC, so a typical rental LLC owes no Florida income tax on its rent (your CPA confirms the entity's election and any federal filings). The practical answer for nearly every rental LLC is the annual report and nothing more. The rest of the Florida investor tax picture, including the property-tax rules that matter far more, is in rental property taxes.
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Frequently asked questions
Can I buy a Florida rental property in an LLC?
Yes: DSCR loans close with title vested in the LLC at the table, personal guaranty behind it, and Florida title companies treat entity closings as routine. The upkeep is the $138.75 Sunbiz annual report, due January 1 to May 1. Conventional loans can't close in an entity, so investors who want LLC title from day one use DSCR.
Does Florida allow series LLCs?
Yes, now: Florida protected series LLCs became legal July 1, 2026 under CS/SB 316 and CS/HB 403. Before that, Florida did not recognize domestic series LLCs, and most online guidance still says so. Protected series give horizontal liability shields with strict recordkeeping; it's attorney-structured, and lender acceptance of series vesting varies by program.
Will transferring my rental into an LLC trigger the due-on-sale clause?
For Fannie Mae loans acquired on or after June 1, 2016, a transfer to a borrower-controlled LLC is exempt under Servicing Guide D1-4.1-02, not a due-on-sale event; Freddie Mac has a similar rule. The Florida catch is separate: a transfer of more than 50% of the entity's interests resets the property's assessment to market value. Coordinate with an attorney and CPA.
Does my Florida rental LLC owe a state income tax?
Almost certainly not. Florida has no personal state income tax, and the state corporate income tax reaches corporations, not the pass-through rental income of a single-member or partnership-taxed LLC. The one recurring cost is the $138.75 Sunbiz annual report. Your CPA confirms your entity's tax election and any federal filings.
Mike Certo · NMLS #260555 · Cornerstone First Mortgage NMLS #173855 · Equal Housing Lender. Educational content, not a loan commitment and not legal, tax, or insurance advice. City and county STR rules, tax figures, and insurance requirements change; verify current requirements with the city, your association, your CPA, or a Florida real estate attorney before you buy. Loans are subject to buyer and property qualification.