Setting up a Florida LLC to hold real estate — Canadian buyer guide

Decisions to make before filing

Single-member vs multi-member

• Single-member LLC (SMLLC): one owner (you, or you + spouse as TBE). US side = disregarded entity by default. CA side = corporation (CRA mismatch problem).
• Multi-member LLC (MMLLC): 2+ owners (you + spouse as two distinct members, or family). US side = partnership by default. CA side = corporation (cleaner alignment with treatment election).

Tax treatment election (Form 8832)

An LLC can elect to be treated as:

• Disregarded entity (SMLLC default).
• Partnership (MMLLC default).
• C-corporation (election via Form 8832).
• S-corporation (US residents/citizens only — not applicable to Canadians).

For most Canadians, MMLLC + corporation treatment (Form 8832 + 1120 US) is the least tax-risky path, but compliance-costly.

Step 1: name choice

• Must contain "LLC," "L.L.C.," "Limited Liability Company," or variants.
• Verify availability on sunbiz.org (Florida Department of State Division of Corporations).
• Avoid names that confuse with existing entities.
• Not required to reserve name — formation creates reservation automatically.

Naming convention

Many investors use address or generic identifier for anonymity: 123 Main Street LLC, Sunrise Properties LLC. Avoid including your personal name if anonymity is the goal.

Step 2: Florida registered agent

Florida requires a registered agent with FL physical address to receive legal notices. For a Canadian without FL address:

• Registered agent service: $50–$300 USD/year (Northwest Registered Agent, Harvard Business Services, ZenBusiness, LegalZoom).
• FL attorney acting as registered agent (often included in formation fees if attorney forms the LLC).
• US-resident member: if an LLC member is FL resident, can be registered agent.

Registered agent receives service of process (lawsuit notices) and tax notifications. Choosing a reliable service is essential.

Step 3: Articles of Organization

Legal document creating the LLC. Filed with Florida Department of State via sunbiz.org.

Required content

• LLC name.
• Principal address (can be registered agent's address).
• Registered agent name and address.
• Registered agent signature accepting designation.
• Authorized managers' or members' names and addresses.
• Effective date (immediate or deferred up to 90 days).

Fees and time

• Filing fee: $125 USD ($100 filing + $25 registered agent designation).
• Online filing: approval 2–5 business days.
• Express filing: $52 supplement for 24-hour processing.

Step 4: IRS EIN

The Employer Identification Number (EIN) is the US tax equivalent of the Canadian business number. Required to:

• Open a bank account under the LLC name.
• File US tax returns.
• Buy or hold property under the LLC name.

Process for Canadians without SSN

• Form SS-4 paper-filed (not online, which requires SSN).
• Submission to IRS by fax or mail.
• Time: 4–6 weeks by fax, 6–8 weeks by mail.
• Free. No third-party service should charge for obtaining.

Tip: a cross-border tax specialist can accelerate by calling IRS on client's behalf (special number for foreign entities). Possible time: 1–2 days.

Step 5: Operating Agreement

Internal LLC document governing relations between members and managers. Not required by Florida Statutes but highly recommended — without operating agreement, the LLC is governed by Chapter 605 default rules, not always optimal.

Standard content

• Members and their participation percentages (membership interests).
• Initial capital contributions.
• Profit and loss distribution.
• Manager powers.
• Interest transfer procedures.
• Dissolution.
• Non-compete (if relevant).

FL attorney drafting cost: $500–$1,500 USD. Free online templates exist, but avoid for cross-border structures.

Step 6: FinCEN BOI report

Since January 1, 2024, the Corporate Transparency Act requires every US LLC to declare its beneficial owners (≥ 25 % of interests, or substantial control) to FinCEN (Financial Crimes Enforcement Network).

Filing window

• New LLC formed 2024+: 30 days after formation.
• LLC existing pre-2024: had until January 1, 2025.
• Update: 30 days after any ownership or identifier change.

Required information

• Each beneficial owner's full name.
• Date of birth.
• Residential address.
• ID number and photo (passport).

Online filing via boiefiling.fincen.gov. Free. Severe penalties for non-compliance ($10,000 USD and more).

Annual maintenance and compliance

• Florida Annual Report: file each year before May 1. Fee $138.75 (standard LLC). Late penalty $400. Online filing via sunbiz.org.
• Separate accounting: bank account under LLC name, no commingling with personal finances (otherwise piercing the corporate veil risk).
• Annual US tax return: per tax treatment (1040-NR if disregarded, 1065 partnership, or 1120-F corporation).
• FinCEN BOI updates within 30 days of any change.
• Florida Sales Tax if LLC does short-term rentals (Tourist Development Tax + 6 % sales tax).
• CA T1135 reporting for Canadian member if interests > C$100,000.

Transferring an already-purchased property to LLC

If you bought in personal name and want to transfer to an LLC formed later:

• Prepare a new deed (Quit Claim Deed) from personal owner to LLC.
• Doc stamps tax: $0.70 per $100 of consideration. If transfer without consideration (gift or capital contribution), often just minimum ($0.70). But if LLC assumes a mortgage, doc stamps applicable on mortgage balance.
• Mortgage due-on-sale clause: most mortgages contain a clause allowing lender to demand repayment on transfer. Garn-St. Germain Act 1982 exempts some intra-family transfers but not all LLC transfers. Verify with lender before transfer.
• Title insurance: issue endorsement or new policy for LLC.
• HOA / condo notification.
• Insurance policy to update.

Typical transfer cost: $500–$1,500 USD (attorney + doc stamps + recording).