No. Florida has no personal income tax, so a Florida resident pays only federal tax on the gain from a practice sale. There is no state capital gains tax and no state tax on rollover equity when it is eventually sold. Florida also has no estate tax.
" - q: "Can private equity own a medical practice in Florida?" a: "Yes. Florida has no corporate practice of medicine doctrine, so a non-physician company can own a practice. The controls come from other laws. Any entity that bills for health services needs a Health Care Clinic license from the Agency for Health Care Administration unless it is wholly owned by licensed practitioners or their immediate family and holds a certificate of exemption. Fee-splitting rules and the Patient Brokering Act also apply.
" - q: "What happens to our clinic exemption when private equity buys in?" a: "It usually ends. The certificate of exemption is not transferable under Rule 59A-33.006 and lapses when ownership moves outside the practitioner and family circle. AHCA has said that an MSO or private equity transaction can void the exemption. The practice then needs a clinic license, a change-of-ownership application filed at least 60 days before closing under Florida Statute 408.803(5), and a physician medical director under 400.9935(1). AHCA has 60 days to act. Build this into the closing timeline.
" - q: "Are physician noncompetes enforceable in Florida?" a: "Yes. The 2025 CHOICE Act created stronger rules for highly paid workers but expressly excludes licensed health care practitioners, so physician noncompetes stay under Florida Statute 542.335. That statute is employer-friendly: courts enforce covenants that protect a legitimate business interest and are reasonable in time and area, and it gives buyers of a business more room than employers. Expect both an employment covenant and a sale-of-business covenant in a private equity deal.
" - q: "How do I become a Florida resident for tax purposes?" a: "Make Florida your permanent home and document it. Occupy a Florida home as your primary residence, get a Florida driver license within 30 days, register your vehicles within 10 days, register to vote, record a Declaration of Domicile with the county clerk under Florida Statute 222.17, and file for the homestead exemption by March 1. Move your bank, doctors, and advisers. File a part-year or final return in the old state, and keep your days in the old state under 183 with records to prove it.
" - q: "If I move to Florida before selling my New York practice, does New York still tax the sale?" a: "Usually yes for a private equity deal. Under New York Tax Law 632(a)(2), a nonresident's share of gain from a 338(h)(10) deemed asset sale, or an asset sale followed by liquidation, is New York-source income. Private equity buyers almost always want asset treatment. New York also applies a statutory residency test: 183 days plus a permanent place of abode in New York for more than 10 months makes you a resident even if your domicile is Florida.
" - q: "If I move to Florida before selling my California practice, does California still tax the sale?" a: "Often yes. Under 18 CCR 17952, gain on an intangible is sourced to where you live at the time of sale unless the intangible has a California business situs, and the goodwill of a practice operating in California arguably does. Gain on California tangible assets is California-source regardless of residence. Installment payments on a sale made while you were a California resident remain California-source after you leave.
" - q: "Does Florida have an estate tax?" a: "No. Only the federal estate tax applies, with a 2026 exemption of $15 million per person. A New York resident who becomes a Florida domiciliary before death also leaves behind the New York estate tax and its $7,350,000 cliff, which is one of the larger reasons physicians make the move.
" llms_summary: "Explains how Florida treats a physician's sale of a medical practice to private equity in 2026. Florida has no personal income tax and no estate tax. It has no corporate practice of medicine doctrine, so lay and private equity ownership are allowed, but the Health Care Clinic Act (Chapter 400 Part X) requires an AHCA license unless the practice is wholly practitioner-owned and holds a certificate of exemption; the certificate is not transferable under Rule 59A-33.006, a change-of-ownership application is due at least 60 days before closing under 408.803(5), and a licensed clinic must appoint a physician medical director under 400.9935(1). The CHOICE Act effective July 1, 2025 excludes licensed health care practitioners, so physician noncompetes remain under the employer-friendly Florida Statute 542.335. Covers domicile steps including the Declaration of Domicile under 222.17, driver license within 30 days, vehicles within 10 days, homestead by March 1, and under 183 days in the old state, plus what New York (Tax Law 632(a)(2), statutory residency) and California (18 CCR 17952) still tax after a move." ---Florida does not tax the sale. The state has no personal income tax, so a Florida resident who sells a medical practice pays federal tax on the gain and nothing to Florida. There is no state tax on the goodwill, no state tax on the noncompete payment or transition pay, and no state tax when rollover equity is sold years later. The federal picture on how a practice sale is taxed is the whole picture: 20 percent on goodwill, up to 37 percent on the ordinary income pieces, and deferral on the rollover until the second bite.
With no income tax, the questions that dominate the California and New York pages have no Florida version. There is no state position on QSBS, bonus depreciation, the installment method, or Opportunity Zones for an individual seller. There is no pass-through entity tax election, because there is no state income tax to move to the entity level. The federal SALT cap phase-down, which strips the federal deduction from California and New York sellers, costs a Florida seller nothing. Florida does impose a corporate income tax on C corporations, so a practice organized as a C corporation should ask its CPA about the entity-level return in the year of an asset sale. Most physician practices in Florida are S corporations or LLCs and pass the gain through to owners who owe no Florida tax on it.
| Item | Figure | Note |
|---|---|---|
| Personal income tax on the gain | 0% | No individual income tax |
| Estate tax | None | Federal exemption $15 million per person applies |
| Corporate practice of medicine | No doctrine | Health Care Clinic Act, fee-splitting, and Patient Brokering Act apply instead |
| Clinic change-of-ownership application | 60 days | Before closing, Florida Statute 408.803(5); AHCA has 60 days to act |
| Driver license after moving | 30 days | Vehicles within 10 days |
| Homestead exemption filing | March 1 | For the year the exemption is claimed |
| Days in the old state | Under 183 | Keep records; New York's statutory test uses 183 days plus a permanent place of abode |
You can move to Florida at any time, and Florida will welcome you with no residency test of its own to worry about. The question is what your old state does. For a private equity deal, the answer is usually that the old state still taxes the sale of the practice itself, and the move helps with everything that comes after.
New York Tax Law 632(a)(2), amended in 2010, treats a nonresident S corporation shareholder's share of gain from a deemed asset sale under Section 338(h)(10), or from an asset sale followed by liquidation, as New York-source income to the extent the corporation's income is allocated to New York. Private equity buyers almost always want asset treatment for the stepped-up basis, whether through a 338(h)(10) election, an F-reorganization, or a direct asset purchase. A physician who moves to Naples in February and closes an asset sale of a Long Island practice in October still owes New York State tax on that gain. Only a pure stock sale without the election escapes, and those are rare. Installment payments keep their New York-source character, so a seller note or earnout from a New York asset sale is New York income when paid.
New York also applies two residency tests, and you must pass both. Domicile turns on five factors: home, active business, time, near-and-dear items, and family. Statutory residency is mechanical: 183 or more days in New York plus a permanent place of abode maintained for more than 10 months of the year makes you a New York resident whatever your domicile. Keeping the Manhattan apartment while living in Florida is how many sellers fail. A move in the year of the sale draws the most audit attention. The New York page covers this in detail, including what a real move does still accomplish: it ends New York City tax, and it ends New York tax on investment income, Roth conversions, and a later stock sale of rollover equity.
California's rule is 18 CCR 17952. Gain from selling an intangible is sourced to the seller's residence at the time of sale unless the intangible has a California business situs. The goodwill of a practice operating in California arguably has a California business situs, and in the Metropoulos decision pass-through goodwill gain was sourced to California because the entity's income was business income apportioned to the state. Gain on California tangible assets is California-source regardless of where you live. The regulation also says that if a California resident sells intangible property on the installment method and later becomes a nonresident, "any later recognized gain attributable to any installment payment receipts relating to that sale will be sourced to California." California decides residency by a closest connections test with a presumption of residency for anyone present more than nine months, and the Franchise Tax Board audits large-gain years with a mid-year move. The California page has the details.
In both states, pay for services follows the work. If you continue to practice in New York or California under the buyer's employment agreement, that salary, and any noncompete or transition payment tied to services there, is taxed by that state regardless of your Florida domicile. The earnouts and installment sales page covers the federal treatment of deferred payments that your old state may also tax.
Florida makes it easy to prove you have arrived. The steps below are the ones your old state's auditor will look for.
Own or lease it, furnish it, and live in it. Sell or stop using the old home if you can; a retained New York abode is the single biggest risk under the statutory residency test.
Florida Statute 222.17 lets you file a sworn declaration with the clerk of the circuit court in your county. It is not required, but it is dated evidence of intent.
The license is due within 30 days of establishing residency and vehicle registration within 10 days. Surrender the old license.
Register to vote in your Florida county. File for the homestead exemption with the county property appraiser by March 1 of the year you claim it. Homestead also brings creditor protection under Florida law, which matters to a physician.
Bank accounts, safe deposit box, physicians, accountant, attorney, estate documents, club and religious memberships. Update your will and trusts to Florida law.
Stay under 183 days in the old state and keep travel records, credit card statements, and phone location data that show where you were.
If your deal is an asset sale, F-reorganization, or 338(h)(10) sale of a New York or California practice, the old state taxes that gain no matter when you move. The move still ends state tax on your future income, your investment gains, and Roth conversions, and for a New Yorker it ends exposure to the state estate tax. Judge the move on those benefits and on whether you want to live in Florida, not on the sale itself.
Florida has no corporate practice of medicine doctrine. A non-physician company, including a private equity fund, may own a medical practice and employ physicians. That makes Florida different from California, New York, and Texas, and it means a Florida deal does not strictly need the friendly professional entity that those states require. Many buyers still use the MSO structure in Florida, because their platform operates in several states and because the licensing rules below often make a management agreement easier than direct ownership. The MSO and friendly PC page explains the structure.
The control in Florida is licensing rather than ownership. Under the Health Care Clinic Act, Chapter 400 Part X of the Florida Statutes, any entity that bills for health care services must be licensed as a health care clinic by the Agency for Health Care Administration (AHCA) unless it qualifies for an exemption. The common exemption is for a practice wholly owned by licensed health care practitioners, or by practitioners and their immediate family members, which holds a certificate of exemption.
That certificate is the trap in a private equity deal. Under Rule 59A-33.006 the certificate of exemption is not transferable, and it lapses when ownership moves outside the practitioner and family circle. AHCA has said that an MSO or private equity transaction can void the exemption. Once it does, the practice needs a clinic license. A change-of-ownership application must be filed with AHCA at least 60 days before closing under Florida Statute 408.803(5), and AHCA has 60 days to act on it. A licensed clinic must appoint a physician medical director under Florida Statute 400.9935(1), who carries personal responsibility for the clinic's billing compliance. Fee-splitting rules and the Patient Brokering Act also apply to how the MSO is paid. None of this is a tax issue, but a deal that ignores the 60-day clock will not close on the date in the letter of intent.
Florida has no health care transaction notice law aimed at private equity of the kind California and New York have. The AHCA change-of-ownership process described above is the practical equivalent: it requires a filing at least 60 days before closing when a licensed clinic changes hands, and it gives the agency 60 days to act. Federal antitrust filing thresholds apply to large deals. A physician group selling to a platform should expect the AHCA process, the medical director appointment, and the buyer's review of billing practices to set the closing calendar.
Florida passed the CHOICE Act, effective July 1, 2025, which strengthens covered noncompete and garden-leave agreements for workers earning more than twice the county annual mean wage and requires courts to grant preliminary injunctions to enforce them. Licensed health care practitioners are expressly excluded. Physician noncompetes therefore remain under Florida Statute 542.335.
Section 542.335 is employer-friendly. It requires the covenant to protect a legitimate business interest, such as patient relationships or goodwill, and to be reasonable in time and geography, and it directs courts not to consider the hardship to the physician in deciding whether to enforce. It treats covenants given by the seller of a business more generously than covenants given by an employee, so the sale-of-business noncompete in your purchase agreement may run longer than the one in your employment agreement. Expect both. The payment allocated to the sale covenant on Form 8594 is ordinary income to you at up to 37 percent federal, and although Florida adds no state tax, the gap between that rate and the 20 percent rate on goodwill is the same as everywhere else. The personal goodwill page explains how to negotiate it.
Florida has no estate tax and no inheritance tax. Only the federal estate tax applies, with a 2026 exemption of $15 million per person, indexed after 2026. For a physician moving from New York, this is a meaningful part of the case for the move, because New York's exclusion is $7,350,000 with a cliff at 105 percent and a top rate of 16 percent. Domicile at death, not residency in the year of the sale, is what decides which state's estate tax applies, so the domicile steps above matter for your heirs as well as for you. Planning for rollover equity is covered on gifting rollover equity before the second bite.
For a lifelong Florida physician, state tax is not a variable in the deal, and you should not pay anyone to plan around it. The questions worth your time are the federal allocation, the clinic license and medical director appointment, the noncompete terms, and the risk in the rollover. For a New York or California physician thinking of moving, the move does not change the tax on an asset sale of the old practice, so if the sale is the only reason to move, the reason is weaker than it looks. Weigh the ongoing benefits, the estate tax, and where you want to live. And if the letter of intent is already signed, the structure is set; the remaining decisions are closing timing, the retirement plan deduction, and getting the domicile steps done cleanly in a year that is not also the sale year.
Find out whether the deal voids your certificate of exemption, who files the change-of-ownership application, and who will serve as medical director. Add the 60-day clock to the closing timeline.
Use the calculator with the actual allocation in the draft LOI. For a Florida resident, federal tax is the whole tax picture.
Ask counsel how the old state sources the sale under 632(a)(2) or 17952, then decide about Florida on its ongoing merits.
Declaration of Domicile, license, vehicles, voter registration, homestead by March 1, and a day count under 183 in the old state.
Other state pages: California, New York, Texas, and the states hub.