Retiring to Florida: The Financial Checklist Before You Move

Key takeaways

Establish domicile deliberately and document it; the former state will test it, especially in the year of a large income event.
Time income around the move: defer what can be deferred until Florida residency, and recognize gains and conversions after, not before.
File for the homestead exemption by March 1 of the year after the move; it caps future assessment increases and adds creditor protection.
Have the estate documents reviewed by a Florida attorney; wills from other states are generally valid, but Florida's homestead, elective share, and personal representative rules change what the documents do.

Florida takes in more retirees than any other state, and most of them treat the move as a real estate transaction with a change-of-address form stapled to it. The financial side deserves the same attention as the house. What follows is the order we work through with clients moving here. The timing matters more than most people expect.

Before the move

Time the income. Florida has no income tax; the state you're leaving does. Income recognized while you're still a resident of the old state gets taxed there. So defer the bonus, the deferred compensation payout, the business sale, and the large Roth conversion until after domicile has changed. Realize losses before, gains after. If a large event can't be moved, ask whether the move can be moved instead. The Florida residency post covers the states that keep taxing certain income of former residents (pensions are federally protected from source-state tax; deferred compensation paid in installments over ten years or more is also protected; stock options and deferred comp paid faster are not).

Read the old state's rules on domicile. New York, California, New Jersey, Massachusetts, and others audit departing residents, and the audit zeroes in on the year of the move and the year of any large income. The tests are facts: where you spend your days (many states use 183), where the primary home is, where the family, doctors, clubs, and valuables are, and what you told the world. Keep a day count. Sell or convincingly downgrade the old home. Move the things that matter.

Review the estate plan before signing anything. A will or trust from another state is generally valid in Florida, but Florida's rules differ. The homestead can't be devised freely if there's a surviving spouse or minor child. A surviving spouse has a 30% elective share. A personal representative who isn't a Florida resident must be a close relative. And Florida's execution formalities (two witnesses, self-proving affidavit) decide whether probate is easy or hard. The Florida trust and will post covers the differences. Plan on a Florida attorney reviewing the documents in the first year.

The move itself

Establish domicile on a date. Buy or lease the Florida home. File a Declaration of Domicile with the county clerk (a simple sworn form that creates a record). Get a Florida driver's license within 30 days of establishing residency and register vehicles within 10 days. Register to vote. Move bank accounts, or at least the primary one, to a Florida branch or update the address of record. Update the address on every financial account, every insurance policy, and with the IRS. Change the mailing address on the passport and Social Security. The documents aren't the domicile; the life is. But the documents are what an auditor asks for.

Notify the old state. File a part-year resident return in the year of the move, and a nonresident return in later years only if there's source income there. Don't keep filing resident returns "just in case." That's evidence against you.

After the move

Homestead exemption. Apply with the county property appraiser by March 1 of the year after you establish the home as your permanent residence. The exemption reduces the assessed value by roughly $50,000 for tax purposes (the second half doesn't apply to school taxes), and more importantly it triggers the Save Our Homes cap, which limits future increases in assessed value to 3% a year regardless of market value. Over a decade of rising prices, the cap is worth far more than the exemption. Homestead status also brings Florida's constitutional protection of the home from most creditors. Clients moving within Florida can port their accumulated cap benefit to the new home; clients arriving from elsewhere start fresh.

Insurance. Property insurance in Florida is a different market. Windstorm, hurricane deductibles of 2% to 10% of the dwelling limit, flood (not included, and usually needed), and the availability of carriers all vary by location. Get quotes before closing, through an independent agent, and hold the deductible in reserve. The Florida homeowners insurance post lists what to check. Auto rates are higher too, and umbrella limits should get a fresh look.

Condo due diligence, if you're buying a condo. Since the 2021 Surfside collapse, Florida requires structural inspections and funded reserves for older buildings, and special assessments have run into six figures per unit. Review the reserve study, the inspection reports, and the association's budget before buying, and hold a reserve for assessments after.

Update the plan for zero state tax. The retirement income plan changes when the state layer disappears. Roth conversions get cheaper, so the annual amount may rise. Municipal bonds lose their appeal relative to Treasuries (no state tax to avoid). Withdrawal order may shift. The retirement income plan gets rebuilt on the new numbers.

Medicare and health coverage. Medicare travels, but Medicare Advantage plans and Part D plans are local; a move is a special enrollment period to change them. Medigap policies travel and are usually kept. Retirees under 65 on an ACA plan enroll in the Florida marketplace, where plan options and subsidies differ.

Professionals. A Florida estate attorney for the document review. A CPA who handles part-year and multistate returns for the transition year. A local independent insurance agent. The advisor can be anywhere, which is one reason retirees who move are increasingly choosing virtual advisors.

What Florida doesn't change

Federal taxes are the same. Social Security taxation, IRMAA, RMDs, the estate tax exemption: all federal, all unchanged. Florida has no estate tax and no inheritance tax, which helps heirs, but the federal exemption of $15 million per person is what matters for nearly everyone. And the cost of living in South Florida, driven by housing and insurance, eats some of the tax savings for households arriving from cheaper regions. The budget should say so honestly.

Where we come in

For clients relocating to Florida, the move becomes a project inside the plan: the income timing, the domicile checklist with dates, the homestead filing, the insurance quotes, the estate document review, and the rebuilt retirement projection. Based in Miami, we know the local insurance and property landscape, and we coordinate with the client's attorneys and CPA on both ends of the move. The Miami planning post covers what local families ask us most.

Frequently asked questions

How long do I have to live in Florida to be a resident?

There's no minimum for Florida; domicile is established when you intend to make Florida your permanent home and act accordingly. The former state's rules are what create a day-count issue. Typically 183 days there triggers residency regardless of domicile.

Can I keep a home in my old state?

Yes, but it makes the domicile case harder. If you keep the old home, spend clearly fewer days there, keep records, and make the Florida home the larger and more used one. Many retirees sell or transfer the old home to children for exactly this reason.

Does the homestead exemption apply to a second home?

No. It applies only to the permanent residence, and a household can have only one homestead. Claiming homestead in Florida while claiming a residency benefit in another state is a common audit trigger and can mean back taxes and penalties.

Should I move before or after selling my business?

After establishing Florida domicile, if you can control the timing. A sale while still resident in a state with a 5% to 13% tax costs that percentage of the gain. The move has to be real and should precede the sale by a meaningful stretch; a move the month before a sale invites an audit that's hard to win.

Joseph G. Valerio, CFP®, EAFounder and Lead Advisor at Valerio Wealth Management, a fee-only, fiduciary virtual family office in Miami, Florida. One advisor, credentialed in both financial planning and federal tax. About Joseph

This article is general education, not individualized advice, and it is not tax, legal, or accounting advice. Figures reflect federal law for the year stated and can change. Valerio Wealth Management does not prepare or file tax returns. Speak with a qualified professional about your own situation before acting.