Orlando and Miami both attract a lot of absentee ownership — domestic investors who bought in Florida from another state, and international investors drawn to Central and South Florida specifically. Both groups face real, practical differences from owning a rental property you can actually drive to. Some of it is pure logistics. For foreign owners, some of it is a genuinely different tax framework.
The logistics problem, regardless of distance
Florida law gives tenants specific rights that assume a landlord who can respond quickly. A landlord must give 12 hours' notice before entering a unit, and entry is only permitted at reasonable times for reasonable purposes (Fla. Stat. § 83.53). Showings for a vacant unit, move-in and move-out inspections, and responding to a maintenance emergency all assume someone can physically be there — or arrange for someone to be, on short notice, correctly.
None of this legally requires you to hire a property manager if you're a domestic owner managing your own property — but "legally allowed to" and "practically able to" are different things once you're several time zones or a flight away. The owners who struggle most aren't the ones who hired help too early; they're the ones who tried to coordinate a 9pm emergency repair call from a different time zone with no one local to actually let the contractor in.
What changes specifically for international owners
If you're a nonresident alien for U.S. tax purposes, U.S. rental income is subject to a genuinely different framework than what a domestic owner deals with — and it catches a lot of foreign owners off guard.
The default: 30% withholding on gross rent
Without any election, the IRS treats U.S. rental income paid to a nonresident alien as FDAP income (Fixed, Determinable, Annual, or Periodical) — taxed at a flat 30% of gross rent, with no deductions allowed for expenses, mortgage interest, depreciation, or anything else. For most rental properties, that's a materially worse outcome than paying tax on net income the way a domestic owner does.
The fix: the Section 871(d) election
Nonresident alien owners can elect under IRC Section 871(d) to treat rental income as "effectively connected income" (ECI) instead. This unlocks the ability to deduct property expenses, mortgage interest, and depreciation against the rental income — taxed at regular graduated rates instead of a flat 30% on the gross amount. Making this election generally means:
- Obtaining an ITIN (Individual Taxpayer Identification Number) if you don't already have one — you cannot file without it
- Attaching a written statement making the 871(d) election to your first Form 1040-NR
- Filing Form W-8ECI with your property manager or withholding agent — this is what actually stops the 30% withholding on your rental payments going forward
- Reporting income and expenses on Schedule E going forward
Once made, the election generally stays in effect for future years unless formally revoked — this isn't something to decide casually, but for most owners with real deductible expenses, it's a significant difference.
Domestic out-of-state owner
- No special tax election needed
- Standard Schedule E reporting
- Main challenge is logistics and response time, not tax structure
International owner
- Needs an ITIN to file at all
- Should evaluate the Section 871(d) election early — the default 30% flat withholding is rarely favorable
- Files Form 1040-NR with Schedule E, plus Form W-8ECI to the property manager
Where Total Rental fits into both
Local presence, wherever you actually are
For both out-of-state and international owners, having a licensed, local team handle showings, entry-notice compliance, inspections, and maintenance coordination closes the practical gap that distance creates. For international owners specifically, we work alongside your CPA on the documentation side — accepting and maintaining a Form W-8ECI on file once your election is made, so withholding is handled correctly at the source.
The tax election is a decision for you and a qualified CPA to make together — it's not something a property manager should be advising on directly. But once that decision is made, the operational side of actually running the property from a distance is exactly what professional management is built to solve.