On the tee
- You must own the home and make it your permanent residence on January 1, then apply by March 1.
- Once a home has the exemption, its assessed value can rise by no more than 3% a year or the change in the CPI, whichever is lower.
- Moving within Florida? Portability can carry up to $500,000 of assessment difference to the new home.
Many people who first came to Orlando to play golf come back to live, often in a home on or near a course. If the home becomes your permanent residence, Florida’s homestead exemption is one of the most valuable things to get right in the first year. It lowers the taxable value of the home, and it starts a cap that limits how fast the assessed value can rise. It is not automatic, though. You have to qualify on a specific date and apply by a specific deadline.
Step 1: Qualify on January 1
Under Section 196.031 of the Florida Statutes, the exemption is for a person who, on January 1, holds legal or beneficial title to the property and in good faith makes it their permanent residence, or the permanent residence of people legally or naturally dependent on them. The deed or other title document must be recorded in the county’s official records before the exemption can be granted.
The date matters. If you close on a home in the spring and move in, you will not meet the January 1 test for that year. You would apply for the following year instead.
Step 2: Apply by March 1
Section 196.011 requires the application to be filed with the county property appraiser on or before March 1. The statute is strict: failing to apply by March 1 is treated as a waiver of the exemption for that year. There are narrow exceptions, for example where the owner can clearly document that the application was late because of a postal error, and the law gives property appraisers some room to accept applications after March 1. But the safe course is to treat March 1 as a firm date.
Tip: Gather the documents your county property appraiser asks for as soon as you close. Applying early in the year leaves time to fix any problem before March 1.
Step 3: Know what the exemption is worth
| Part of the exemption | What s. 196.031 provides |
|---|---|
| First $25,000 | Exempt from all property taxes, except assessments for special benefits |
| Additional exemption | Up to $25,000 more on assessed value above $50,000, for all levies other than school district taxes |
| Inflation | The additional amount is adjusted each January 1 for inflation when the Consumer Price Index rises |
The first exemption applies to school taxes as well as other levies; the additional one does not apply to school district levies. For a typical home, that means the exemption reduces the taxable value used by the city, county and other taxing authorities by more than it reduces the value used for school taxes.
Step 4: Understand the cap
The second benefit is often worth more over time. Section 193.155 says homestead property is reassessed every January 1, but any change in its assessed value may not exceed the lower of 3 percent of the prior year’s assessed value or the percentage change in the Consumer Price Index for the preceding year. If the assessed value would end up higher than the home’s just value, it is lowered to the just value.
The cap starts from the year after the home first receives the exemption. When a homestead property changes ownership, it is reassessed at its full just value as of January 1 of the following year, and the cap starts again from there. That is why a buyer’s tax bill can be quite different from the seller’s.
Step 5: Use portability if you are moving within Florida
If you already have a Florida homestead and are moving to a new one, the savings from the cap do not have to disappear. Under Section 193.155(8), a person who received a homestead exemption as of January 1 of any of the three years before establishing a new homestead may have the new home assessed at less than its just value. When the new home is worth the same or more than the old one, its assessed value is the new just value minus the old home’s difference between just value and assessed value, up to a limit of $500,000. When the new home is worth less, a proportional amount carries over. Ask the property appraiser how to claim it when you apply for the new homestead.
Keeping the exemption
Once granted, the exemption usually carries forward. Section 196.011 allows counties to waive the annual application, and where they do, owners do not have to reapply every year. But owners must notify the property appraiser promptly if their use of the property or their status changes, such as renting the home out or moving away. The penalties for failing to do so are serious: if the appraiser finds that an owner was not entitled to the exemption in any of the prior 10 years, the owner can owe the taxes that were exempted, plus 15 percent interest a year and a penalty of 50 percent of those taxes.
Common questions
Can a vacation home get the exemption?
No. The exemption is for your permanent residence. A second home or rental in a golf community does not qualify, and it is not covered by the homestead cap.
Does the exemption affect HOA dues?
No. Association dues and assessments are separate from property taxes. See Buying a Home in a Florida Golf Community: The Disclosure Summary and Other Documents for what the HOA disclosure summary tells you about them.
Homestead rules have many details, including additional exemptions for some groups of owners. Your county property appraiser’s office is the best source for forms and local procedures, and a tax professional can advise on your situation. This guide is a summary of the statutes and not tax advice.