LLC Structuring for Foreign Buyers of Miami Real Estate

Foreign buyers of Miami real estate who own in personal name face US estate tax of 40% on values above $60,000 at death. For buyers from non-treaty countries (most of Latin America, Middle East, Asia), this is a catastrophic exposure. The default solution: hold the property through a Florida LLC, which itself is owned by a foreign corporation or trust in your home country. This blocks US estate tax entirely.

Basic Structure

Miami Real Property (LLC-owned) -> Florida LLC -> Foreign Corporation or Trust (home country). Because the foreign corporation owns the LLC, not you personally, your US estate doesn't include US property on death, only the stock in the foreign corporation, which is foreign-situs and not subject to US estate tax.

Steps to Set Up

1. Form Florida LLC via Sunbiz.org ($125 filing fee, $138 annual)
2. Obtain EIN from IRS (Form SS-4, no cost)
3. Open Florida LLC bank account (requires EIN and operating agreement)
4. Set up foreign parent entity in your home country (structure depends on country)
5. Execute operating agreement making foreign parent the sole member
6. Close on property in LLC name

Typical Costs

• Florida LLC formation: $125 + $100-500 legal fee = $625 total
• Foreign parent formation: $1,500-$5,000 depending on country
• Annual Florida LLC: $138 filing
• Annual CPA (Form 5472 filing): $1,500-$3,000
• Annual foreign parent compliance: $500-$2,000 depending on country

What You Gain

Elimination of US estate tax exposure on Miami property. Asset protection (LLC liability shield). Privacy (LLC ownership records are less public than personal deed records). Multi-property portability (same LLC can hold multiple Miami properties).

What You Lose

Mortgage rate penalty: some lenders charge 0.25-0.50% higher rates for LLC borrowers. Simpler cash transactions do not trigger this. Transfer costs: if you form the LLC after you already own in personal name, you pay documentary stamps and recording fees again. Annual compliance complexity: Form 5472 filings with IRS are mandatory and penalty for non-filing is $25,000+.

When to NOT Use an LLC

Buyers from treaty-exemption countries with large estate exemptions (Canada, UK, Germany, etc.) often gain little from LLC structuring. For these buyers, personal-name ownership is cleaner and cheaper. Also, if the property is your genuine primary residence (not just for tax purposes), homestead exemption benefits favor personal-name ownership. For a detailed breakdown of how this decision applies specifically to UK buyers, including the 2025 non-dom abolition context, see my guide for British buyers in Miami.

"LLC structuring is the single highest-ROI tax decision most foreign buyers will make. Spending $4,000 before closing to avoid $400,000 in estate tax 15 years later is the best trade in the Miami luxury market."

Planning a Miami purchase and need to decide on ownership structure? Reach out and I will connect you with a cross-border CPA and Florida real estate attorney to build the right structure before you close.

"I've closed transactions with international buyers across multiple countries. The ones who arrived with a checklist of specific questions on reserves, deposits, and assignment terms, consistently negotiated better on final terms."Gerardo Gonzalez, Licensed Real Estate Agent at Compass

Frequently Asked Questions