Homestead Exemption

Homestead Exemption

One of the great many advantages of owning a home in the state of Florida is the tax benefit of Homestead Exemption.

Every person who purchases and resides in a home in Florida on January 1^st and thusly makes this their permanent residence, is eligible to receive a homestead exemption of up to $50,000. The tax benefit is applied in increments of $25,000; the first going towards all property taxes, including school district taxes. The additional exemption of up to $25,000 applies to the assessed (or taxable) value of the real property.

Keep in mind that to be eligible for the full $50,000 exemption you must be legally married. If you are listed as single, divorced, widowed, etc. you are still eligible for an exemption, however it is capped at $25,000. There are also additional exemptions for widows/widowers, disabled, veterans, and much more.

A basic breakdown of the Homestead Exemption is as such:

Joe and Jane Smith purchased their home at a price of $500,000 on December 1^st. On December 15^th they recorded this as their permanent residence by switching their drivers’ licenses and enrolling their children into local schools. On January 1^st they would be eligible to apply for the full $50,000 exemption as they are a legally married couple proving their Florida home as their permanent residence. Thusly, instead of paying taxes on the assessed value of $500,000 they would only be paying taxes on a value of $450,000.

To know more about the difference between Assessed (taxable) value and Fair Market (appraised) value of a home, please refer to my previous blog on this topic. I am here to aide in as smooth of a transition for you and your family as possible.