State Taxes Beyond FIRPTA: Florida's Tax-Free Advantage
FIRPTA is a federal withholding requirement. It applies to all DVC sales by foreign persons regardless of which resort the contract is at. But several US states have their own real estate withholding rules for non-resident sellers (and whether these apply to your DVC sale depends on which resort you own.
Florida: No State Income Tax
The majority of DVC resorts are in Florida) Walt Disney World: Saratoga Springs, Bay Lake Tower at Contemporary, Boulder Ridge and Copper Creek Villas at Wilderness Lodge, Old Key West, Riviera Resort, Beach Club Villas, Boardwalk Villas, Caribbean Beach, Polynesian Village, Animal Kingdom Lodge Villas. Florida has no state income tax, which means no state withholding on DVC sales at these resorts.
Florida DVC sellers pay only federal FIRPTA withholding (15%) at closing and file only one federal tax return (Form 1040-NR) to claim their refund. No state filings are required.
Hawaii: HARPTA Adds 7.25%
Aulani, a Disney Vacation Club Resort, is in Ko Olina, Hawaii. In addition to federal FIRPTA withholding (15%), Hawaii imposes its own withholding under HARPTA (Hawaii Real Property Tax Act) at 7.25% of the gross sale price. Combined federal and state withholding at closing: 22.25%.
HARPTA applies to all non-Hawaii-resident sellers (including US citizens from other states. FIRPTA applies only to non-US persons. A US citizen selling Aulani faces only HARPTA (7.25%), not FIRPTA.
Recovering HARPTA withholding requires separate filings with the Hawaii Department of Taxation) Form N-288C for a prompt post-closing refund, or Form N-15 (Hawaii non-resident return) after year-end. See our complete HARPTA guide.
South Carolina: Hilton Head DVC
Hilton Head Island Beach and Tennis Resort (a DVC home resort) is in South Carolina. South Carolina has a real estate withholding requirement for non-resident sellers of 7% of net proceeds (not gross proceeds) on sales over $1,000. In practice, closing agents in South Carolina handle this withholding at the state level.
Most Hilton Head DVC sales are modest in size and the SC state tax exposure is small (the SC income tax rate on capital gains is up to 7%. Sellers can file a SC non-resident return (SC Form 1040) after year-end to reconcile actual SC tax and recover any overpayment. South Carolina gives a credit for federal tax paid, reducing double taxation.
California: Grand Californian
Disney's Grand Californian Hotel and Spa DVC is in Anaheim, California. California imposes a 3.33% withholding on sales of California real property by non-California-resident sellers (under Cal. Rev. & Tax. Code Section 18662). This applies to the gross sale price unless the seller is exempt or provides a specific certification.
California state income tax on the gain can be significant) California's top marginal rate is 13.3% with no special rate for long-term capital gains. Non-resident sellers file a California Form 540NR to claim any refund of excess state withholding.
Grand Californian DVC sales involve three potential withholdings: federal FIRPTA (15%), California non-resident withholding (3.33%), and potentially California estimated tax. For non-US Grand Californian sellers, consult a tax professional before closing.
Vero Beach: Florida (No State Tax)
Disney's Vero Beach Resort is in Florida. Like all Florida DVC, there is no state withholding or state income tax. Only federal FIRPTA applies.
Summary by Resort
| Resort | State | Federal FIRPTA | State Withholding |
|---|---|---|---|
| Walt Disney World resorts (Saratoga Springs, Bay Lake Tower, etc.) | Florida | 15% | None |
| Aulani | Hawaii | 15% (non-US only) | 7.25% HARPTA (all non-HI residents) |
| Hilton Head | South Carolina | 15% (non-US only) | 7% on net proceeds |
| Grand Californian | California | 15% (non-US only) | 3.33% |
| Vero Beach | Florida | 15% | None |
Frequently Asked Questions
Do WDW DVC sellers pay state tax on their sale?
No. Florida has no state income tax, so sales of Walt Disney World DVC contracts have no state withholding or state income tax obligation. Only federal FIRPTA withholding (15%) applies.
What extra taxes does Aulani DVC have compared to WDW DVC?
Aulani sellers pay Hawaii HARPTA withholding (7.25%) on top of federal FIRPTA (15%) (22.25% combined. US citizens selling Aulani pay only the 7.25% Hawaii withholding (not FIRPTA). WDW sellers in Florida pay only federal FIRPTA (15%).
Does California withholding apply to non-US Grand Californian sellers?
Yes. California imposes 3.33% withholding on non-California-resident sellers of California real property, in addition to federal FIRPTA. Non-US Grand Californian sellers may face both at closing and should consult a tax professional familiar with both California and FIRPTA rules.