2025 State Tax Changes Taking Effect January 1st

Florida’s sales tax applies to most retail sales certain services and includes provisions for online sales, which aligns with the national trend toward taxing digital transactions. The state also offers various sales tax exemptions, including certain groceries, prescription drugs, and agricultural supplies, providing some relief to consumers. Florida is one of the few states that does not collect income taxes. However, its state and local tax burden of 8.9 percent ranks it 34th nationally. While you might not have to file a tax return, there are many other ways does florida have state tax the state collects money.

Are there any tax breaks for older Florida residents?

Here are some of the thousands of quotes taken directly from our customers. The information in this article is up to date for tax year 2024 (returns filed in 2025). Finally, residents of the Sunshine State are occasionally treated to Florida tax holidays!

The Florida Income Tax Guide: Understanding the Florida State Tax and Florida Tax Rate

Plus, even without revenue from income taxes, Florida still manages to have the eighth-best roads and 15th-best bridges in the country. With rock-solid infrastructure and fewer taxes than most anywhere else in the nation, it’s easy to see why Florida is a top spot for retirees looking to make the most of their golden years stress-free. Out of all 50 states and Washington, D.C., Florida’s effective property tax rate of 0.83% was the 26th-highest in the nation — Hawaii has the lowest property tax rate at 0.27%, while New Jersey has the highest at 2.30%. However, Florida’s low property tax rate hits differently depending on the home values in the city where you own property. Property Taxes – The average property tax rate for residential property in the state of Florida is 0.94%, which is right in line with the country’s average of 0.93%.

State Corporate Income Tax Rates and Brackets, 2024

Thanks largely to Florida’s nonexistent income tax, the state ranks second in the nation in terms of securing a solid return on tax dollars.
The impact on diesel prices is greater, increasing the total estimated levy from 14 cents per gallon in 2024 to 59 cents per gallon in 2025.
Florida’s corporate tax structure includes an Alternative Minimum Tax (AMT) to ensure a minimum tax contribution from all corporations.
Florida property rates are relatively low compared to the national average and a Florida tax relief bill passed last year allows Floridians to enjoy many items tax-free.
Florida imposes a flat sales tax rate of 6% on nearly all goods and services in the state.
If you live in Florida or if you’re thinking about making the move down, you want to talk with a tax pro.
This has since increased to $8,348 per capita, but is now the third lowest by state.

The Show Me State will decrease its top marginal individual income tax rate from 4.8 percent in 2024 to 4.7 percent effective January 1, 2025. This reduction is part of a series of tax cuts initiated under legislation enacted in 2022 (SB 3 and SB 5), which allow for a 0.1 percentage-point decrease each year that revenue goals are met, until the top rate reaches 4.5 percent. While you won’t have to worry about state tax returns or state tax bills, it’s important to understand how each of these states generates revenue without relying on income taxes. The answer lies in the state’s constitution, which prohibits the imposition of a personal income tax. While Floridians do not have to pay state income taxes, they are still required to pay federal income taxes. This lack of an income tax is one of the key factors that contributes to Florida’s reputation as a tax-friendly state.

Sales Tax – Like most states, Florida has both local and state sales tax. Florida sales tax rates are broken down as follows – 6.00% is the the average Florida sales tax rate, is 1.00% is the average local Florida sales tax rate (bringing the total average Florida sales tax rate to 7.00%). The Florida corporate income/franchise tax rate was previously reduced from 4.458% to 3.535% for taxable years beginning on or after Jan. 1, 2021, but before Jan. 1, 2022. However, the corporate income tax rate has since increased back to 5.5% (where it was prior to 2019) for tax years beginning on or after Jan. 1, 2022.

Florida Inheritance Tax

Under HB2, Louisiana will implement a single-rate individual income tax of 3 percent, along with a higher $12,500 standard deduction, now indexed to inflation. Louisiana will also consolidate its corporate income tax structure to a single, flat rate of 5.5 percent, effective January 1, 2025. This change will eliminate the three-bracket system with current rates ranging from 3.5 percent to 7.5 percent. Living in a no income tax state can come with disadvantages like higher sales and property taxes, which can lead to increased living costs and reduced public services. So, while you save on income tax, you might pay more in other areas.

Florida estate and inheritance taxes

Nevada relies heavily on revenue from high sales taxes on everything from food to clothes, sin taxes on alcohol and gambling, and taxes on casinos and hotels. This results in a state-imposed total tax burden of 7.37% of personal income for Nevadans, the third-highest on this list. Florida is often considered a top destination for retirees, but adults of all ages can enjoy the fact that Florida is one of nine states that doesn’t have a state personal income tax. Florida property rates are relatively low compared to the national average and a Florida tax relief bill passed last year allows Floridians to enjoy many items tax-free. The same law also increased the standard deduction, personal exemption, and dependent exemption. By temporary proviso, the FY 2025 budget lowered the state’s top marginal individual income tax rate for tax year 2024 by an additional 0.1 percentage points, to 6.2 percent, ahead of the statutorily scheduled reduction in 2025.

However, for businesses, you need to make sure you charge and pay the correct Florida sales tax rates in case you are selected for a Florida sales tax audit.
In 2023, the state maintains its competitive tax rates, contributing to its appeal as a business and residential location.
The tax was eliminated in 2004 when the federal government changed the available tax credit to a deduction.
Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airline, or hotel chain, and have not been reviewed, approved or otherwise endorsed by these entities.
Under HB2, Louisiana will implement a single-rate individual income tax of 3 percent, along with a higher $12,500 standard deduction, now indexed to inflation.
On the bright side, you can buy a flag in Florida—either the U.S. flag or that of the state—without paying any tax at all.

According to Kiplinger, they have ranked Florida as the 4th friendliest for 2018 and the top 5 states are all states with no income tax. Policymakers should consider the unintended consequences, both to public health and public coffers, of the excise taxes and regulatory regimes for cigarettes and other nicotine products. There are no “death taxes,” otherwise known as inheritance taxes, in Florida on the value of estates or inheritances.

State Tax Changes Taking Effect January 1, 2024

It has a corporate tax rate of 4.5 percent, which is favorable (4th nationally) compared to other states. You can file your taxes online through the Florida Department of Revenue. There, you can also check out helpful resources on all taxes imposed in the state.

Minnesota will increase its state motor fuel tax to 31.8 cents per gallon for gasoline, diesel, and biodiesel, up from the current 28.5 cents per gallon as of 2024. This adjustment includes a 28.3-cent per gallon excise tax and a 3.5-cent per gallon debt service surcharge. Illinois will increase its franchise (capital stock) tax exemption from $5,000 to $10,000, effective January 1, 2025. Notably, however, Illinois had once been on track to eliminate this tax altogether, a policy that has since been paused. Delaware’s Office of the Marijuana Commissioner will begin issuing marijuana sales licenses in 2025.

Florida imposes a flat sales tax rate of 6% on nearly all goods and services in the state. A handful of products have a lower tax rate, including amusement machine receipts (4%) and commercial property renting, leasing, or licensing (2). Electricity is the only commodity taxed at the slightly higher rate of 6.95%. Clients who are able to stay with the program and get all their debt settled realize approximate savings of 46% before fees, or 25% including our fees, over 12 to 48 months. Not all clients complete our program for various reasons, including their ability to save sufficient funds.