Federal Income Tax Laws
Five of the 100 items cover the federal income tax consequences of owning, operating, and disposing of a principal residence and of investment real estate.
Principal residence and investment property
Internal Revenue Code section 121 excludes gain on the sale of a principal residence owned and used as such for at least 2 of the 5 years preceding sale, up to $250,000 for a single filer and $500,000 for a married couple filing jointly. For investment property, residential rental improvements are depreciated straight-line over 27.5 years and nonresidential real property over 39 years, and land is never depreciated. Adjusted basis is the original cost plus capital improvements minus depreciation taken, so depreciation deductions increase the gain recognized on a later sale.
Deferring tax on disposition
A like-kind exchange under Internal Revenue Code section 1031 defers gain where the taxpayer identifies replacement property in writing within 45 days of transferring the relinquished property and receives it within 180 days, the two periods running concurrently. Since the 2017 Tax Cuts and Jobs Act, section 1031 applies to real property only. Separately, under FIRPTA the buyer of a United States real property interest from a foreign seller must generally withhold 15 percent of the amount realized, with reduced rates available for certain residences and a withholding certificate available on application.
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State-specific details
State exam facts
- State regulator
- Florida Real Estate Commission (FREC), DBPR
- Exam vendor
- Pearson VUE
- Prelicensing education
- 72-hour FREC-approved broker pre-license course
- Passing score
- 75%
- Scored questions
- 100
- Time limit
- 210 minutes
Who regulates real estate brokers in Florida?
The Florida Real Estate Commission (FREC), housed within the Department of Business and Professional Regulation (DBPR), licenses brokers and sales associates. DBPR uses Pearson VUE as the official testing provider.
What experience do I need before the Florida broker exam?
Section 475.17(2)(b), F.S., requires 24 months of licensure during the preceding five years, and it accepts any of three paths: an active sales associate license held in Florida or in another state, territory, or foreign jurisdiction; a sales associate license held while salaried by a governmental agency; or a broker license held in another jurisdiction. An out-of-state broker therefore qualifies without ever having held a Florida sales associate license. Applicants must also complete the 72-hour FREC-prescribed broker course (Course II).
How is the Florida broker exam structured?
Florida gives one integrated 100-question multiple-choice examination — there is no separate national portion and no state portion. Candidates get 3.5 hours (210 minutes), and the exam is graded on 100 points with 75 points or higher required to pass. The DBPR booklet publishes twelve content areas whose percentages sum to 100, led by Real Estate Brokerage Business at 43% and Closing Transactions at 12%. Pearson VUE schedules, administers, scores, and reports the exam for DBPR.
Sources: https://www2.myfloridalicense.com/servop/testing/documents/RE_broker_cib.pdf, https://www.flsenate.gov/Laws/Statutes/2025/Chapter475/PART_I, https://www.flrules.org/gateway/Division.asp?DivID=241, https://www.pearsonvue.com/us/en/fl/dbpr.html
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