If you live in
Florida, “Homestead Exemption” does not just cover one small facet of real
property. In addition to exemption from taxation it also provides an exemption from forced sale before and at death, restrictions on devise and alienation,
protection to surviving spouse or
minor child as well as many
other things. However for this blog, the
part we are all most concerned with is: the property tax exemption
clause of Article VI, which “renders property tax-free to the extent of certain
dollar amounts in the value of the homestead”.
With this exemption homesteaders in Florida are able to save on property taxes because we may exclude a portion of our home's value from its assessment. To qualify you must own real property in Florida on January 1st and the amount of tax owed is calculated based on the difference between a home’s value and the exemption amount. For Floridians, on Jan. 29, 2008 voters approved an amendment to the Florida Constitution raising this exemption to $50,000 (the first $25,000 applies to all property tax), which is a nice change from the original $5,000 when the amendment was first passed in 1933…not too bad!
With this exemption homesteaders in Florida are able to save on property taxes because we may exclude a portion of our home's value from its assessment. To qualify you must own real property in Florida on January 1st and the amount of tax owed is calculated based on the difference between a home’s value and the exemption amount. For Floridians, on Jan. 29, 2008 voters approved an amendment to the Florida Constitution raising this exemption to $50,000 (the first $25,000 applies to all property tax), which is a nice change from the original $5,000 when the amendment was first passed in 1933…not too bad!
It
is important to know that while the provisions apply automatically when
one establishes a primary residence in FL, in order to benefit from the
exemption, it must be claimed by a filing with the local county property appraiser's
office. Another good thing to note is that the annual increase in
assessed value for one’s homestead limited to the lesser 3% of the
percentage change in the Consumer Price Index, which
basically means there is a cap on the rate at which property
assessments may be increased annually and we have the "Save Our Homes"
Amendment to thank for this; it was passed by voters in 1992, and went
into effect in 1995.
For
our purposes, remember that the homestead exemption only applies to
principal residences and can only be claimed by mortgage holders. They
are only available for a primary residence; they don’t apply to
businesses, rental property, second homes, homeowners claiming permanent
residency-based exemptions or tax credits in other states or homes with
owners that do not claim Florida as their primary residence. Again we
have “Save Our Homes” to thank for allowing homesteaded owners to move
up to $500,000 of the benefit from one Florida home to the next. New buyers make a note: acquiring
a house that had a homestead exemption does not entitle the new owner
to retain the low tax rate from the previous homesteaded resident
homestead exemptions cannot be inherited or purchased. Also, under
Florida law, the homestead exemption is only available to US citizens,
permanent resident aliens or others who are legally able to form the
intent to remain permanently under immigration laws. If something
changes and your home is no longer your primary residence, you should
notify the county tax assessor's office. In some states, failure to do so is considered fraud and can result in a criminal charge.
For
our purposes, remember that the homestead exemption only applies to
principal residences and can only be claimed by mortgage holders. They
are only available for a primary residence; they don’t apply to
businesses, rental property, second homes, homeowners claiming permanent
residency-based exemptions or tax credits in other states or homes with
owners that do not claim Florida as their primary residence. Again we
have “Save Our Homes” to thank for allowing homesteaded owners to move
up to $500,000 of the benefit from one Florida home to the next. New buyers make a note: acquiring
a house that had a homestead exemption does not entitle the new owner
to retain the low tax rate from the previous homesteaded resident
homestead exemptions cannot be inherited or purchased. Also, under
Florida law, the homestead exemption is only available to US citizens,
permanent resident aliens or others who are legally able to form the
intent to remain permanently under immigration laws. If something
changes and your home is no longer your primary residence, you should
notify the county tax assessor's office. In some states, failure to do so is considered fraud and can result in a criminal charge.
Here is a helpful
link to help you file for your homestead exemption:
Other links that may
be helpful are:
Happy Tax Season to all! With love from your friends at Regal Homes!
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