Many investors from the region assume that the inheritance laws of their home countries apply to their properties abroad, but in the U.S., the exemption for foreigners is only $60,000 USD. If you own a property in your personal name, the government can tax up to 40% of the excess value, which is why it is vital to structure your real estate investment in Florida correctly. At Florida HomeGroup Realty, we advise you so that you can invest in Florida while protecting your children’s legacy and preventing the IRS from becoming the majority partner of your family wealth.
1. The “$60,000 gap”: a figure that shows no mercy
The U.S. tax law of 2026 is generous with its citizens but extremely strict with foreigners.
- Citizens and Residents (Green Card): They have an exemption of up to $15 million in 2026 before paying a single cent in estate tax.
- Non-Resident Foreigners: The exemption is only $60,000 USD. This figure has not been adjusted for inflation in decades.
Real-world example: If you buy a condo in Miami or a vacation home in Orlando for $500,000 USD in your personal name, and you pass away, only the first $60,000 is tax-free. The remaining $440,000 will be taxed at a rate that quickly reaches 40%. Your family would have to pay the IRS nearly $150,000 USD before they can even take possession of the home.
2. The probate process: time is money
In addition to the tax, there is a legal process called Probate (Inheritance Trial).
- Delays: A probate trial in Florida can take anywhere from 6 months to 2 years.
- Costs: Attorney fees and court costs typically consume between 3% and 8% of the property’s total value.
- Frozen accounts: During this time, the property cannot be easily sold or rented, and associated bank accounts may be blocked.
3. How to protect your family: proven strategies for 2026
At Florida HomeGroup Realty, we work with tax experts to help our clients avoid this scenario through smart structures:
The use of LLCs and “blocker” corporations
As mentioned in previous articles, purchasing through an LLC (provided it is correctly structured as a corporation for succession purposes) can prevent the property from being considered a personal asset in the U.S., effectively eliminating the Estate Tax.
Foreign trusts
A well-structured trust allows the property to pass from generation to generation without going through a Florida court and without triggering the inheritance tax.
Life insurance as a hedge
For some investors, taking out a life insurance policy in the U.S. that covers the potential tax amount is the most cost-effective way to ensure their heirs receive the property debt-free.
4. What about the spouse?
It is a common mistake to think that the property automatically passes to the husband or wife without taxes.
- If the surviving spouse is not a U.S. citizen, the unlimited marital deduction does not apply.
- In 2026, there is an annual exclusion for gifts between non-citizen spouses of approximately $194,000 USD, but for death, the $60,000 limit remains the primary barrier.
Frequently asked questions about the estate tax
Does my country have a tax treaty with the U.S.?
Very few Latin American countries have Estate Tax treaties with the U.S. (unlike Income Tax treaties). It is vital to verify this with our advisors before closing your purchase in Lake Nona or Kissimmee.
Can I just put the property in my child’s name now?
Be careful. Changing the name on a deed can be considered a “gift,” which also carries high taxes (up to 40%) and strict annual limits ($19,000 USD per person in 2026).
What happens if the property has a mortgage?
The tax is calculated based on the fair market value of the property, not your invested capital (equity). If the house is worth $800,000 but you owe $500,000, the IRS may still calculate the tax on a base much larger than what you actually “own.”
Florida HomeGroup Realty’s commitment to your legacy
Investing in Florida real estate should be a source of peace, not anguish for your loved ones. That is why our guidance does not end when we hand you the keys:
- Title Review: We ensure that the way you “take title” is the most efficient for your family.
- Expert Referrals: We connect you with probate attorneys who speak your language and understand the laws of your country.
- Constant Updates: We keep you informed about changes in laws like FIRPTA and the 2026 tax acts to ensure your structure is always legal and efficient.
Do not leave your children’s future to chance
The success of an offshore investment is solidified when protection is total. Buying in your personal name is an unnecessary risk that can cost half of your investment in taxes and legal fees.
Do you want to check if your current structure protects your heirs?
Request a case review with our wealth consultants and secure your family’s future.
