Legal Intelligence
Homestead Tax Exemption and Homestead Property Protection
By Blanca Greenstein, Esq., & Nadia Hoosien, Esq. with Greenstein & Associates
The State of Florida provides Florida Residents with Homestead protection and Homestead Tax Exemptions. With tax season around the corner, it is important for you to understand Florida’s Homestead Tax Exemptions, as well as the requirements that are necessary in order for you to receive Florida’s Homestead Protection for your property.
What is Homestead Tax Exemption?
The Florida Department of Revenue provides a detailed explanation of the differing exemptions that fall under Homestead Tax Exemption, and provides the forms and requirements necessary to obtain these exemptions (dor.myflorida.com). Homestead Tax Exemption requires you to apply for it through your county property appraiser, and as additional documents may be required, be sure to check with your specific county’s property appraiser for further details. Homestead Tax Exemption extends to a Florida resident who occupies his or her property on January 1, with the intention of that property being his or her primary residence. Meeting the requirements for Homestead Exemption allows you to be eligible to receive a homestead exemption up to $50,000.00. According to the Florida Department of Revenue website, the “first $25,000 applies to all property taxes, including school district taxes. The additional exemption up to $25,000, applies to the assessed value between $50,000 and $75,000 and only to non-school taxes.” (For more information check here). As each county may require different forms and documents for the application process, please be sure to visit your property appraiser’s website for more information.
What is Homestead Protection?
The Florida Constitution provides that certain real property (and personal property up to $1,000.00) be termed and treated as “Homestead”. Article X, Section 4, of the Florida Constitution provides Homestead Protection to Florida Residents, and is available at the following website: www.leg.state.fl.us. The Statute provides that certain property (“homestead”) is protected against certain creditors of the owner of the homestead, and those creditors can therefore not force the sale of your Homestead property. It is imperative however, that you understand that your Homestead protection does not protect you against all creditors. Your Homestead property can be subject to a forced sale for homeowner or condominium association assessment fees, for taxes and assessments, your mortgage, and a mechanics lien (a lien placed on your property for repairs, improvements, or labor performed on your property). Additionally, there are restraints placed on your Homestead property that prohibits the voluntary conveyance of the property away from a spouse or minor child. The Statute further provides that if your property is within a municipality, Homestead protection will extend to ½ acre of adjoining land. If your property is outside of a municipality, the protection will then extend to up to 160 acres of adjoining land.
Requirements to obtain Homestead Protection?
- In order to receive the protection of Homestead property, the owner must be a Florida Resident and intend the property to be his or her primary residence. Therefore, it is important that you understand that a second home or vacation home will not qualify under the protection of Homestead.
- The protection applies only to a natural person; in other words, titling property in a corporation or partnership, will not afford the same protection.
- Homestead protection will protect your property only if the Homestead was established prior from levy of the creditors. You can establish your Homestead protection immediately once you occupy your property and have the intention of the property being your primary residence.
As Homestead applies only to your intended primary residence, it is important for you to understand how selling your property or abandoning your property will affect your Homestead protection. Your Homestead protection may be forfeited if you intend to abandon your property. As you no longer have an intention for that property to be your primary residence, the protection will no longer apply. If however you decide to sell your primary residence, the Homestead protection will extend to even the proceeds of the sale if you intend to use those proceeds to reinvest into another property as your primary residence. As both Homestead protection and Homestead Tax Exemptions can offer great benefits, it is important for you to understand both the requirements and elements necessary in obtaining their protections. If you have further questions, or would like to discuss your taxes and Homestead protections further, the Law Offices of Greenstein and Associates will be happy to provide you with more information.
Disclaimer: This column is not intended to provide legal information or advice. All data and information provided on this column is for informational purposes only as well as to give general information and a general understanding of the law, and not to provide specific legal advice. By reading this column you understand that there is no attorney client relationship between you and the publisher. This column should not be used as a substitute for competent legal advice from a licensed professional attorney in your state.