One of the benefits for those who call Florida their home is strong homestead protection. Article X, Section 4 of the Florida Constitution protects one’s primary residence from most creditors’ claims, which also results in tax benefits associated with the homestead.Ā
How much money do you save with homestead exemption in Florida? Read on to find out.
Florida Homestead Property – The Basics
Florida homestead law prevents a judgment creditor from attaching a lien against a debtor’s primary residence and forcing a foreclosure to collect unpaid debts. Article X, Section 4 (a)(1) defines a homestead property as:Ā
- “If located outside a municipality, to the extent of one hundred sixty acres of contiguous land and improvements thereon, which shall not be reduced without the owner’s consent by reason of subsequent inclusion in a municipality; orĀ Ā
- If located within a municipality, to the extent of one-half acre of contiguous land, upon which the exemption shall be limited to the residence of the owner or the owner’s family”Ā
Please note that the definition of homestead encompasses not only single-family houses but extends to condominiums, mobile homes, and manufactured homes.
Homestead Property vs. Homestead Exemption in Florida
Even though the homestead tax exemption derives from the Constitutional homestead, one cannot confuse both terms. While homestead owners do not need to file documents to qualify for Constitutional protection against judgment creditors, they need to file for the state tax exemption.
The state of Florida grants residents some exemptions to reduce the assessed value of the property, which results in a reduced amount of property taxes. The eligibility for the homestead tax exemption depends on three elements:
- The owner of the property must intend it to be a primary residence
- The owner must reside in the homestead, and
- The owner must be the legitimate title holder or have a beneficial interest in the homestead
If the primary residence of a Florida resident is titled in his or her personal name or the name of a revocable living trust, the property qualifies for the exemption. Conversely, the homestead exemption does not apply to properties titled in the name of:Ā
- Limited liability company (LLC)Ā
- CorporationĀ
- An irrevocable trust, orĀ Ā
- Any legal entity (including sole proprietorships)Ā
The eligibility rules for the tax exemption require the owner to occupy the homestead on January 1 and file the required paperwork with the county tax assessor or property appraiser.
How Much Do You Save with Homestead Exemption in Florida? – In Detail
After filing for the homestead exemption, Florida residents seize advantage of a $25,000 exemption applied to the first $50,000 of the assessed value of the property. This primary exemption includes school district taxes.
As long as you owned the homestead on January 1 of the tax year and have been occupying the property as your primary residence since that date, you are eligible for the exemption.
If the assessed value of the homestead is between at least $50,000 and $75,000, an additional exemption of up to $25,000 is applied. However, the additional exemption does not apply to school district taxes.
Additionally, the Florida homestead exemption includes the Save Our Homes benefit. This benefit caps the increase in the property’s assessed value to the annual Consumer Price Index (CPI) or equal to 3% – whichever is less.
Protect Your Homestead Exemption Rights in Florida – Immediately Contact Jurado & Associates, P.A.
A well-versed attorney from Jurado & Associates, P.A. is willing to help protect your homestead rights. Contact us by calling (305) 921-0976 or emailing [email protected] for expert legal guidance.Ā