FIRPTA and Lady Bird Deeds: What Foreign Property Owners in Florida Need to Know
The intersection of FIRPTA and Lady Bird deeds can create confusion for non-resident aliens (NRAs) who own Florida real estate. At Aspire Legal Solutions, we help foreign property owners navigate these complexities with confidence and clarity.
What is FIRPTA?
FIRPTA stands for the Foreign Investment in Real Property Tax Act. It is a U.S. federal law that requires foreign sellers of U.S. real estate to pay a withholding tax — typically 15% of the sale price. The law ensures non-resident aliens pay applicable capital gains taxes on real estate sales.
What is a Lady Bird Deed?
A Lady Bird Deed (also known as an Enhanced Life Estate Deed) is a powerful tool in Florida estate planning. It allows the property owner to:
- ✅ Retain full ownership and control of the property during their lifetime
- ✅ Avoid probate by automatically transferring property upon death
- ✅ Revoke or amend the deed at any time
Does FIRPTA Apply to a Lady Bird Deed?
No — FIRPTA does not apply when creating a Lady Bird deed because:
- ❌ There is no present sale or exchange
- ❌ The deed only takes effect upon death
- ❌ There is no transfer of ownership for value
The mere act of executing a Lady Bird deed does not trigger FIRPTA.
When Could FIRPTA Still Apply?
FIRPTA might apply later if:
- 🔹 The foreign owner sells the property during their lifetime
- 🔹 The heirs or remaindermen sell the property and they are also foreign persons
In these cases, the 15% FIRPTA withholding tax may be required.
Additional Considerations for NRAs
U.S. Estate Tax may apply if a non-resident alien owns Florida real estate at the time of their death — even if the property is passed via Lady Bird deed. To reduce exposure:
- ✅ Use U.S.-based LLCs or offshore trusts for ownership
- ✅ Plan for estate tax exposure with a qualified attorney
- ✅ Ensure coordination with tax professionals in both the U.S. and your home country
Contact Aspire Legal Solutions
If you are a foreign property owner or real estate investor looking to protect your privacy, reduce probate exposure, or avoid costly tax mistakes, our firm can help. We assist clients nationwide with Florida property structuring.
- 📍 1901 W Colonial Drive, Orlando, FL 32804
- 📞 (844) 973-4043
- ✉️ hello@aspirelegal.com
- 🌐 www.AspireLegal.com
