Rental Income Taxes and Records for Florida Owners

Florida has no state personal income tax, so rental income from a Florida home is reported to the IRS, usually on Schedule E. The federal rules turn on how much you use the home yourself: more than 14 days or 10% of the rented days makes it a residence for tax purposes, and renting a residence for under 15 days takes the income off the return entirely. Good records are what let you prove the split.

Does Florida tax rental income?

Not for individuals. The Florida Department of Revenue’s FAQ says Florida does not impose a personal income tax, so there are no filing requirements for individuals, though businesses have filing requirements. Article VII, Section 5(a) of the Florida Constitution limits any state tax on the income of natural persons who are Florida residents or citizens to amounts that may be credited against or deducted from a similar tax levied by the United States or any state.

Florida’s taxes on a short-term rental are on the rent itself: the 6% state sales tax, the county surtax and the county tourist tax. Those are collected from guests and are separate from income tax.

Which federal form do you use?

IRS Publication 527 (2025), Residential Rental Property, says Schedule E (Form 1040) is the basic form for reporting residential rental income and expenses. It also says some rentals do not belong there.

Publication 527 says Schedule C is generally used when you provide substantial services in connection with the property. If you provide services primarily for the tenant’s convenience, “such as regular cleaning, changing linen, or maid service,” you report on Schedule C, and you may owe self-employment tax on Schedule SE. Heat, light, cleaning of public areas and trash collection are not substantial services. Short-term rentals often include cleaning between guests, so this is a question to settle with your tax preparer for each property.

What are the 14-day and 10% personal-use rules?

They come from IRC §280A(d)(1). You use a dwelling unit as a residence for the year if your personal use is more than the greater of:

• 14 days, or
• 10% of the days it is rented at a fair rental price.

Publication 527 counts a day as personal use when the home is used by you or any other owner, by a family member of an owner unless that person pays a fair rent and uses it as a main home, by anyone under a home-swap arrangement, or by anyone paying less than a fair rental price. A day you stay in the home during a period you rented at a fair price counts as personal use for this test.

The publication’s example is a beach cottage rented at a fair price for 85 days and used by the family for 14 days in May, plus 2 days the July renter let the owners use it. Those 16 personal days exceed both 14 days and 10% of the 83 rental days counted for the test, so the cottage was used as a home.

What happens if the home counts as a residence?

Two things. First, under Publication 527, you must divide expenses between rental and personal use, generally by the ratio of days rented at a fair price to total days used. Only the rental share goes on Schedule E.

Second, if the home is a residence and your rental expenses exceed rental income, some of the excess cannot offset other income. Publication 527 says those expenses carry forward to the next year as rental expenses for the same property, and Worksheet 5-1 figures the limit.

What is the 15-day rule?

Under §280A(g), if you use a home as a residence and rent it for less than 15 days during the year, the rental income is not included in gross income and no deduction is allowed because of the rental use. Publication 527 says not to report it on Schedule E; mortgage interest, property taxes and casualty losses are reported on Schedule A as usual.

Do passive loss rules apply to short stays?

IRS Publication 925 (2025) says an activity is not a rental activity for the passive activity rules if the average period of customer use is 7 days or less. You figure the average by dividing the total days in all rental periods by the number of rentals in the year. When that exception applies, whether you materially participated decides how losses are treated, which is a detail to work through with a tax professional.

Which income is taxable, and when?

Publication 527 says advance rent is income in the year received, whatever period it covers. A security deposit you plan to return is not income when received; any part you keep because the tenant broke the lease is income in the year you keep it. A security deposit that will be used as the final rent payment is advance rent.

What records should you keep?

Publication 527 tells owners to keep the costs of repairs separate from improvements and to keep accurate records, because improvement costs are needed for depreciation and for figuring gain or loss on a sale. Based on what Publication 527 asks you to figure, the records that support these numbers include:

• Booking and payout statements showing rent received for each stay.
• A calendar of rental days, personal-use days and days available but not rented.
• Receipts for expenses, separated between repairs and improvements.
• Closing statements and improvement records that establish the property’s basis.
• Depreciation worksheets; Publication 527 says to keep them in your records even though they are not attached to the return.

The IRS page How long should I keep records? says to keep records supporting income, deductions or credits until the period of limitations for that return runs out, generally 3 years after filing. Records connected to property should be kept until the limitations period expires for the year you dispose of it.

Florida’s sales tax side has its own rule. Rule 12A-1.061(21) requires anyone who collects rent on transient accommodations to keep rental agreements, receipts and exemption certificates until the tax can no longer be assessed under §95.091(3).

How Florida Hosts helps

We help owners set up the Florida tax accounts a rental needs, along with the DBPR license and any local registration. Our own cleaning and maintenance staff and 24/7 guest communication run the property, and short-term management is 18–25% of booking revenue, quoted in writing. For monthly furnished stays or annual leases, we manage the home with licensed brokers for the leasing. A free rental projection arrives within one business day.

This guide is general information, not legal or tax advice. Confirm how these rules apply to your property with a CPA or other tax professional.