1 minute read 15 Feb 2021
Miami florida skyline

On the move: asset management firms head to Florida

Authors
Augusto Oliveira

Principal, Financial Services, International Tax and Transaction Services, Ernst & Young LLP

Experienced tax professional. More than a decade helping global institutions and private clients with international tax structuring and fund management.

Brian Schad

Managing Director, EY Private Tax, Ernst & Young LLP

Enjoys spending time with his children. Also enjoys reading about US and UK history and watching baseball.

Shawn Smith

EY Americas Financial Services Tax Managing Partner

Passionate about tax transformation and innovation within the industry. Enjoy spending time with my family, reading and traveling.

1 minute read 15 Feb 2021

An accelerated trend and its key tax considerations.

Predating the outbreak of COVID-19, many companies considered moving their business operations out of high-tax jurisdictions to the Sunshine State, with many ultimately making the move in recent months. Where ‘working from home’ is the new ‘norm’, businesses are reevaluating more than ever where to maintain offices.

While the asset management industry operates throughout the United States, South Florida is quickly becoming an important center for financial services.

The appeal of low tax rates on businesses

Most states impose an income tax on corporate entities, so operating in a state with a lower corporate income tax rate can be favorable if a business is structured as a corporation.

Asset managers are typically structured as pass-through entities, which are generally not subject to a corporate income tax. However, states where asset managers are formed as partnerships tend to be jurisdictions that impose a high personal income tax. In addition, there are several states and municipalities that also impose taxes on a pass-through entity’s income or receipts.

Below you will find an illustration of corporate and flow-through taxes for businesses in key jurisdictions.

Is relocation right for your business? A few key factors to consider:

  • Technology advancements
  • Cost of operations
  • Real estate costs
  • Quality of life
  • Diversity of tale

Summary

Not only for your business, but there are also advantages to consider for your personal financial situation.

Some of the tax advantages the state of Florida offers are:

  • No state or local income tax
  • No state estate tax
  • Low property tax

About this article

Authors
Augusto Oliveira

Principal, Financial Services, International Tax and Transaction Services, Ernst & Young LLP

Experienced tax professional. More than a decade helping global institutions and private clients with international tax structuring and fund management.

Brian Schad

Managing Director, EY Private Tax, Ernst & Young LLP

Enjoys spending time with his children. Also enjoys reading about US and UK history and watching baseball.

Shawn Smith

EY Americas Financial Services Tax Managing Partner

Passionate about tax transformation and innovation within the industry. Enjoy spending time with my family, reading and traveling.