What is homestead and how does it help me?
Florida homestead is a Florida law provides for lower property tax on homestead property. Under the Florida Constitution, every Florida homeowner can receive a homestead exemption up to $50,000. The $50,000 is broken into two parts; the first $25,000 in property value is exempt from all property taxes and school tax, the second $25,000 is just for property tax.
Homestead Benefits
Property that qualifies as Florida homestead has important benefits, including asset protection, family protection, and property tax savings. And if the homeowner is married, he or she cannot transfer the property without the signature of his or her spouse (even if the spouse is not listed on the property).
Asset Protection
Florida has homestead laws that protect property owners from claims by creditors. These laws protect qualifying Florida homeowners from having their homes forcibly sold to pay creditors.
· Unlimited Value – Florida’s homestead laws protect an unlimited amount of value in a home. Even luxury homes worth millions of dollars are fully protected from creditors under Florida homestead law.
· No Waiting Period – There is no waiting period for Florida homestead protection. On the day that a homeowner occupies the property intending to make it a Florida homestead, the home becomes protected from creditors.
· Inheritability – Florida homestead law protection can be inherited by the surviving spouse or heirs of the property owner. The home will continue to be protected from creditor claims after the owner’s death.
Family Protection Benefits
To protect a homeowner’s family from disinheritance, the Florida Constitution restricts the homeowner’s ability to transfer homestead property if the homeowner is married. During his or her lifetime, a married person that owns a Florida homestead cannot transfer the home without the participation (joinder) of his or her spouse.
These restrictions on transfer also apply to transfers made when the homeowner dies leaving a spouse or minor children. If the homeowner is survived by a minor child, he or she cannot leave the property to anyone other than the surviving spouse or children. Similarly, if the homeowner is survived by a spouse but no minor children, the homeowner can only devise the homestead to the spouse.
Portability
A Florida resident who buys a new home can transfer homestead exemption from the previous homestead to the new one. To do so, the Florida resident must re-establish a new Florida homestead within two years of January 1 of the year in which the person left the prior homestead. The person must then submit Form DR501T to the property appraiser for the county where the new homestead is located by March 1. More on how this works on later pages.
Requirements
There are three requirements to qualify for homestead protection under Florida law: a residency requirement, an acreage limitation, and a human being limitation. These requirements are discussed below.
Residency
Only Florida residents can claim Florida homestead exemption. To become a Florida resident, a person must reside in Florida with the intent of residing in Florida permanently.
Acreage Limitation
Florida homestead protection only protects a homestead if it meets certain acreage requirements. The amount of acreage that will be protected by Florida homestead exemption depends on whether the homestead is located within a municipality. If the residence is located within a municipality, only one-half an acre can be protected by the Florida homestead exemption; if the residence is located outside a municipality, up to 160 acres can be protected.
Human Being Limitation
To qualify for homestead protection, the property must be “owned by a natural person” (a human being). If the property is owned by a corporation or a limited liability company, for example, it will not qualify for Florida homestead protection.
Courtesy of the Hillsborough County Property appraiser
Portability Frequently Asked Questions
Q: What is Portability?
A: Portability, also known as the “Transfer of Homestead Assessment Difference”, is the ability
to transfer the dollar benefit of the Homestead CAP from one Homestead to another. The
Homestead CAP is the difference between market value and assessed value, often known as
the Save Our Homes Benefit.
Q: Do I have to sell my home before I can qualify for portability?
A: No, you only need to abandon (or give up) your existing homestead, meaning you may still
own the property but no longer receive a homestead exemption on the property for the year you
are attempting to get portability.
Q: Do I have to purchase a new property to get the portability benefit?
A: No, if you already own another property (2nd home, beach house, etc.) and establish your
new homestead, you can remove (abandon) the homestead from the old property and apply for
the portability benefit.
Q: Would my CAP amount be “portable” if I move to another county in Florida?
A: Yes. Portability is effective throughout the state.
Q: When do I apply for portability?
A: You typically apply for portability when you apply for the homestead exemption. There is a
separate application for portability in addition to the homestead application.
Q: How do I apply for portability?
A: Fill out the DR-501T “Transfer of Homestead Assessment Difference” application when you
file an application for your new homestead exemption. If you have already applied for the
homestead exemption, you can download the application from our website, complete and
submit it to the Property Appraiser’s office.
Q: Is the Portability application different from the Homestead application?
A: Yes, presently these are two different applications and both must be completed to receive
both homestead and portability.
Q: After I’ve sold or abandoned my prior homestead, how long do I have to use my
portability?
A: Florida Statute 193.155(8) states that you may transfer your CAP if you have, “received a
homestead exemption as of January 1 of either of the 2 immediately preceding years.” In other
words, you may only go one tax year without having a homestead exemption in order to transfer
your CAP. Thus, if you sell or abandon your homestead on December 31 2015, then you must
re-establish a homestead as your primary residence on or before January 1, 2017.
Q: How is the Save Our Homes CAP calculated?
A: The amount of the CAP is the difference between your Just (Market) Value and your
Assessed Value. The difference between the market value and your assessed value is often
called the “CAP differential” or “CAP savings”. The amount of the CAP can vary from year to
year depending on the value of your property.
Q: What information do I need to complete the Portability Application?
A: Required information on the Portability Application includes the date which the previous
homestead was sold or no longer used as a homestead, the county, address and parcel
identification number of the previous homestead, and a list of all other owners listed on the tax
roll.
Q: Do I have to be an owner to apply for portability?
A: Yes, you must be an owner on both the old home and the new home.
Q: Do both owners of a property need to sign the Portability Application?
A: Yes, if you lived and had homestead on the previous parcel and are both moving and living
at the new parcel, you both must sign the Portability Application.
Q: I sold my home last year and just found out that my CAP was less than I thought it
would be. Can I appeal last year’s value to increase my CAP amount?
A: No, F.S. 194.011(6)(b) specifically precludes a taxpayer from petitioning to have the Just,
Assessed, or taxable value of the previous homestead changed.
Q: What is the maximum amount of CAP I can transfer to my new property?
A: The maximum CAP amount you can transfer is $500,000.
Q: Can I also apply for additional exemptions such as widow/widower, disability or senior
exemption if I use portability?
A: Yes. You still can apply and receive any additional exemption for which you qualify.
Q: How do I know how much CAP I have to transfer or carry to my new homestead?
A: The amount of the CAP you can carry to your new homestead depends on whether you “upsize”
(buy a higher valued property) or “downsize” (buy a lower valued property). The exact
amount will be determined by the Property Appraiser’s office after you file for homestead and
Portability on your new residence.
Q: I sold my homestead in 2006 and I had a large CAP. Do I qualify for portability?
A: Unfortunately no. The law only allows portability for property that had a homestead from
2007 forward. Homesteads sold or abandoned in 2006 or prior do not qualify.
Q: If I sell my home this year and purchase a new homestead, would I be able to transfer
my CAP to the new homestead in time to reduce my tax bill this year?
A: No. If you sell (or abandon) your homestead and apply for a new homestead in the same
year, your CAP portability would be applied in the following year.
Q: I co-own a homestead with a friend and we have a $700,000 CAP. Can we each take
$350,000 to our separate new homesteads?
A: No. The maximum amount of CAP transfer from a single homestead is $500,000. Therefore,
the maximum that could be transferred by two previous joint owners of a single homestead
establishing different homesteads is $250,000 each.
For a complete list of Q&A you can visit the Hillsborough County Property Appraiser web site at https://hcpafl.org/
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