5 Red Flags in Florida Real Estate Contracts That High-Net-Worth Buyers Can’t Afford to Miss
Florida is a magnet for high-net-worth buyers. No state income tax, asset protection advantages, a booming luxury market, and favorable homestead exemptions make it a smart jurisdiction for U.S. citizens and international investors alike. But those benefits can disappear quickly if the contract is flawed, and most buyers don’t realize where the problems are hiding.
Luxury real estate contracts often look polished on the surface. But when you’re investing millions in a property, “standard terms” aren’t good enough. If you’re using an LLC, trust, foreign entity, or a deal involving multi-layered tax planning, you need more than a basic legal review. You need strategic protection built into the contract itself.
What sets one Florida real estate attorney apart from another isn’t just experience, it’s who can spot the financial and tax traps hidden in the fine print. Jacqueline Salcines is not only a seasoned attorney but also a former CPA, and that makes all the difference.
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Missing or Misleading Contingencies
It’s not uncommon for high-end contracts to be written as “cash deals” for speed or leverage, but if financing is actually involved, that’s a problem. If you waive the financing contingency and your lender doesn’t fund the deal, your deposit could be lost, and the seller may have legal grounds to sue.
Also, if the contract doesn’t include an appraisal contingency, the buyer could be locked into a purchase price even if the home appraises far below the agreed amount. That means a larger cash outlay or restructured financing, neither of which may make sense in a tax-optimized portfolio.
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Shortened Inspection Periods
In a competitive luxury market, it’s common to offer a short inspection window to gain an edge. However, high-end homes often require specialized inspectors because they include smart home systems, custom construction, imported materials, and amenities like elevators or seawalls that can’t be properly reviewed in just a few days.
A shortened inspection clause may pressure the buyer to waive inspections entirely or settle for surface-level findings. If there’s no clause allowing the buyer to cancel or renegotiate based on inspection results, this becomes a high-risk move, especially for buyers using the property through an entity or trust.
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“As-Is” Contracts Without Specific Seller Obligations
In Florida, many deals close under “as-is” terms, but that doesn’t mean the buyer should take on open permits, code violations, or municipal liens.
Unless the contract includes specific language obligating the seller to resolve liens, violations, and title issues before closing, the buyer could inherit these liabilities, some of which could create costly legal, tax, and insurance problems post-closing. Most real estate attorneys don’t address this in depth. A lawyer with tax knowledge will ensure these items are properly handled and don’t disrupt depreciation schedules, homestead strategies, or entity-level write-offs.
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FIRPTA Tax Withholding and Foreign Seller Red Flags
When a seller is not a U.S. citizen or resident, FIRPTA (Foreign Investment in Real Property Tax Act) requires a withholding of up to 15% of the sale price at closing. If the contract doesn’t include a FIRPTA addendum or the parties fail to allocate responsibility for IRS compliance, the buyer may be held liable for underpayment, even years later.
What most attorneys won’t tell you: there are ways to reduce or avoid FIRPTA withholding altogether, including exemptions based on intended use, sale price, or IRS certificates. But these require advance planning and filing, and only an attorney who understands U.S. tax law and cross-border transactions can properly guide you through it.
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Non-Refundable Deposits Without Tax Planning Language
In high-value deals, large deposits are often made non-refundable after a short inspection or financing period. But what happens to that deposit if the deal falls apart and how is it treated for tax purposes?
Depending on how the property is titled and how the buyer’s entity is structured, forfeiting a deposit may create a capital loss, a deductible expense, or a disallowed deduction. Most transactional lawyers won’t even consider this, but the implications are real for someone buying through a holding company or trust. This is where a real estate attorney with tax training can add immediate value.
A Florida real estate contract shouldn’t just get you to the closing table. It should protect your investment, structure, and tax strategy for years.
That’s where Jacqueline Salcines stands apart. As a real estate attorney and former CPA, she offers more than standard legal review. She provides strategic, tax-conscious representation designed for high-net-worth clients.
Never Close Alone. Contact the Law Offices of Jacqueline A. Salcines, PA, to ensure your next Florida real estate contract is as sophisticated as your investment strategy.