Wall Street Heading South and Not Just for the Winter

January 29, 2013 James Heinsman In the News

Tax-Free Florida Luring Wall Street South

Fed-up with exorbitant tax rates and a business-unfriendly establishment, many hedge fund companies and private equity firms have made the decision to relocate to a place where they are being welcomed with open arms and delightful tax breaks: Palm Beach County, Florida.

“Florida is a state of choice,” said Thalius Hecksher, global development chief for Apex Fund Services. Hecksher has already moved many of his operations to Palm Beach. “It’s organically grown. There’s no need to drag people down here. It’s a zero-income-tax jurisdiction.”

Newcomers to Florida are happy about some of the fringe benefits of being in the south as well, such as a sunny and warm day in January when New Yorkers might be shoveling themselves out from a few feet of snow.

Although there is no difference in the Federal tax rates between New York and Florida, the big deal-breaker is that there are no state income taxes in Florida. On the other hand New York has one of the highest state tax rates, second only to Alaska.

Florida residents had to pay 3.31 percent of their income in taxes while in New York that amount comes to 5 percent. Also, commercial properties are much cheaper in Florida.

“You weigh all of the benefits for being here to those in New York, and they outweigh them every time,” said Evan Rapoport, CEO of HedgeCo.net, which is expanding its presence in Palm Beach County.

“This fiscal-cliff issue, with tax rates continuing to go up. We’re seeing where we’re going with taxes,” Evan added. “In our industry, the people we’re talking about are $1 million-a-year earners. So when you’re talking about tax rates, it’s more meaningful.”

“Then,” he added, “there’s the lifestyle issue.”
 

Evan Rapoport, Florida, New York, Thalius Heksher,

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