Renting out a Palm Beach County home while you live abroad brings federal, state and local rules into play. The IRS taxes the rent and, by default, collects that tax through whoever pays you. Florida and the county tax short stays, and the state, some towns and your association can limit how you rent.
The federal rules below are for nonresident aliens, and your status, any treaty and how you hold title are questions for a cross-border tax adviser. If you’re still buying, see our foreign buyer’s guide to Florida real estate and our second-home guide for Palm Beach County.
Key takeaways
- By default, the payer withholds tax at a 30% (or lower treaty) rate on the gross rent.
- You can instead choose to be taxed on net rental income and give the payer Form W-8ECI, which needs a U.S. taxpayer identification number.
- Stays of six months or less carry 6.5% sales tax and the county’s 6% Tourist Development Tax. Online platforms do not remit the county tax.
- Check licensing, town registration and association rules before you list.
How is rental income taxed for a non-U.S. owner?
It’s taxed one of two ways. U.S. income that isn’t effectively connected with a U.S. trade or business is taxed at a flat 30% (or lower treaty) rate. Effectively connected income is taxed after allowable deductions, at the graduated rates that apply to U.S. citizens and residents (IRS Publication 519).
The IRS’s own example: a nonresident not engaged in a U.S. trade or business rents out a single-family house, and the rent is their only U.S.-source income. The tenants withhold tax at a 30% (or lower treaty) rate, and because that satisfies the owner’s U.S. tax, no Form 1040-NR is required.
In the same example, if the owner makes the choice covered below, certain rental expenses can offset the rent, and any net income is taxed at graduated rates. Florida, for its part, does not impose a personal income tax, according to the Florida Department of Revenue.
Who withholds the tax, and on what amount?
The person who pays you the rent withholds the tax, and it’s figured on the gross amount. IRS Publication 515 says payers must withhold on income such as rents from U.S. real property held for the production of income, unless the foreign owner elects to treat it as effectively connected.
Publication 515 defines a withholding agent as any U.S. or foreign person with control, receipt, custody, disposal or payment of the income. That can be a tenant, or a property manager or agent who receives the rent for you.
The agent can’t reduce the gross amount by any deductions, so your carrying costs don’t lower the tax. That’s where the net-basis choice comes in.
Can you be taxed on net rental income instead?
Yes. If you own U.S. real property and hold it for the production of income, you can choose to treat all income from that property as effectively connected with a U.S. trade or business. You can then claim deductions attributable to that income, and only your net income is taxed, at graduated rates (IRS Publication 519).
The choice covers all income from U.S. real property you hold for the production of income, not one home at a time. You make the initial choice by attaching a statement to your return, or an amended return, for the year of the choice. It stays in effect for all later tax years unless you revoke it.
Whether it’s worth it depends on your figures and treaty position, so run the numbers with a cross-border tax adviser before the first rent payment.
When is the return due?
Making the choice means filing Form 1040-NR, the return nonresidents use, and to take any allowable deductions, it must be timely, true and accurate. If you don’t receive wages subject to U.S. income tax withholding, it’s due by the 15th day of the 6th month after your tax year ends: June 15 for a calendar year.
For deductions, filing within 16 months of that due date counts as timely. If no U.S. tax, or too little, is withheld, you may have to pay estimated tax (IRS Publication 519).
How does Form W-8ECI work?
An owner who chooses to treat the rent as effectively connected must give the payer Form W-8ECI, according to Publication 515.
The form doesn’t go to the IRS. You give it to the person requesting it, generally whoever pays you, before the payment is made, credited or allocated. It also needs a U.S. taxpayer identification number (TIN) to be valid (IRS Instructions for Form W-8ECI).
What if you don’t have a U.S. taxpayer identification number?
If you’ll use an ITIN, the IRS’s individual taxpayer identification number, you apply on Form W-7. Its instructions say applicants must include the required documentation, plus a U.S. federal tax return unless they meet an exception (IRS Instructions for Form W-7).
Exception 1(d) is the one to read. It covers individuals receiving income such as rental income who must provide an ITIN to the withholding agent for tax withholding or reporting. Start early, since the payer needs your W-8ECI before the rent is paid.
Which Florida and Palm Beach County taxes apply to short stays?
Florida’s sales tax and Palm Beach County’s Tourist Development Tax both apply, and each goes to a different agency. The state’s 6% sales tax, plus any discretionary sales surtax, applies to rent for stays of six months or less. The Department of Revenue’s examples include single-family homes and condominium units (Florida Department of Revenue). For 2026, Palm Beach County’s surtax is 0.5% (Florida Department of Revenue, Form DR-15DSS).
The Tourist Development Tax is a 6% charge on revenue from transient rentals of six months or less, on top of state sales tax of 6.5% in Palm Beach County. It’s paid on the rental revenue including all mandatory fees, such as cleaning and pet fees, and it’s to be collected from the guest. If it isn’t, you’re liable (Palm Beach County Tax Collector).
Longer leases differ: rent under a bona fide written lease for continuous residence longer than six months is exempt from the sales tax, the Department of Revenue says.
Registration and monthly reports
Anyone who rents out transient accommodations must register with the Department of Revenue to collect, report and remit the tax, and so must anyone who receives the rent on the owner’s behalf (Florida Department of Revenue).
On the county side, anyone offering transient accommodations must register a Tourist Development Tax account online with the Tax Collector. Vacation rentals also need a Short-Term Rental Local Business Tax Receipt for each account, renewed annually by September 30. When you advertise online, display the tax account number and the receipt number.
The host must collect and remit the tourist tax, and online platforms do not remit it to the Tax Collector. Monthly reports are due on the 1st and late after the 20th, resulting in interest and penalties (Palm Beach County Tax Collector).
Do you need a state license or a town registration?
You may need one or both. Under Florida law, and subject to its exceptions, a transient public lodging establishment includes a unit or dwelling rented to guests more than three times in a calendar year for periods of less than 30 consecutive days. It also includes one advertised or held out to the public as regularly rented for such periods (s. 509.013, Florida Statutes).
Condominium and cooperative units, and single-family to four-family houses and dwelling units, that meet that definition are vacation rentals, unless they’re timeshare projects (s. 509.242). Each public lodging establishment must obtain a license from the Division of Hotels and Restaurants of the Department of Business and Professional Regulation (s. 509.241 and s. 509.013). Check license types and fees with the division.
State law also limits local rules. A local law, ordinance or regulation may not prohibit vacation rentals or regulate how long or how often they’re rented, unless it was adopted on or before June 1, 2011 (s. 509.032, Florida Statutes).
Registration is a separate matter, and some towns require it. The Town of Juno Beach makes it unlawful to operate a vacation rental within town limits without first registering it with the town’s planning and zoning department (Town of Juno Beach Code, Sec. 34-1322). The Village of North Palm Beach says that, effective October 1, 2021, any vacation rental operating without a valid registration violates the Village code (Village of North Palm Beach).
If the home is in Jupiter, another town or unincorporated Palm Beach County, confirm the current rules with that town or the county before you list. Our guides to Juno Beach and North Palm Beach cover those towns more broadly.
Can a condo or HOA limit your rentals?
Yes, within limits that differ for condominiums and homeowners’ associations. In a condominium, the rule covers amendments that prohibit renting, change the rental term or limit how many times owners may rent in a given period. Such an amendment applies only to owners who consent and owners who take title after it takes effect (s. 718.110, Florida Statutes).
In a homeowners’ association, the rule covers governing documents and amendments enacted after July 1, 2021 that prohibit or regulate rentals. Those generally apply only to owners who take title after they take effect or who consent (s. 720.306, Florida Statutes).
One exception matters here. An association may amend its documents to prohibit or regulate rentals for a term of less than six months, and to prohibit renting a parcel more than three times in a calendar year. Those amendments apply to all owners.
Both turn on timing, so ask when each rental rule took effect. Our guide to part-time living in Palm Beach County lists the association documents worth requesting.
Three thresholds to keep apart
| Rule | Threshold in the rule |
|---|---|
| State sales tax and county Tourist Development Tax | Rentals of six months or less |
| State vacation rental license | Rented more than three times in a calendar year for periods of less than 30 consecutive days, or advertised or held out as regularly rented for such periods |
| HOA amendments that bind every owner | Rentals for a term of less than six months, or renting a parcel more than three times in a calendar year |
What changes when you sell?
A different withholding applies. When a nonresident sells a U.S. real property interest, the buyer must generally withhold 15% of the amount realized. The rate is 10% if the buyer acquires the property for use as a residence and the amount realized does not exceed $1 million (IRS Publication 519).
That’s FIRPTA withholding, and it’s separate from anything withheld on rent. Our foreign buyer’s guide to Florida real estate covers how it works.
Considering a Palm Beach County home you’d rent out?
From 2017 to 2024, Keller Williams recognized Cibie Cahur as being in the top 1% of all agents, based on county sales statistics, and HomeLight named her a Top Negotiator from 2021 to 2024. She speaks English, Spanish and French; our page on working with a trilingual agent in Palm Beach has more.
If you’d like help checking a community’s rental rules before you buy, or selling a home you own here, contact us. A consultation is free, with no obligation.
Call or text 561-401-5758 · The Cahur Group, Keller Williams Jupiter
Frequently asked questions
Do I have to file a U.S. tax return if tax is withheld from my rent?
Not necessarily. In the IRS’s Publication 519 example, a nonresident not engaged in a U.S. trade or business, whose only U.S.-source income is rent, needn’t file Form 1040-NR because the tenants’ withholding satisfies the tax. Choosing net-basis tax means timely filing a true and accurate return to take any allowable deductions.
Will a booking platform remit Palm Beach County’s tourist tax for me?
No. The Palm Beach County Tax Collector says online platforms do not remit the Tourist Development Tax, and the host must collect and remit it. It’s a 6% charge on revenue from transient rentals of six months or less, with monthly reports due on the 1st and late after the 20th.
Does Florida tax rental income?
Not as personal income: the Florida Department of Revenue says Florida does not impose a personal income tax, though businesses have filing requirements. Stays of six months or less still carry 6.5% sales tax in Palm Beach County and the county’s 6% Tourist Development Tax.
The short version
Start with one federal decision: accept withholding at a 30% (or lower treaty) rate on gross rent, or choose net-basis tax, file Form 1040-NR and give the payer Form W-8ECI. For stays of six months or less, register for the state sales tax and the county’s Tourist Development Tax. Then check licensing, town registration and association rules before you list.
Rules and figures come from the agencies, statutes and town codes cited inline, and they change. This is general information, not tax or legal advice: confirm your situation with a cross-border tax adviser and your registrations with each agency and town.
