It’s a new year and tax time is just around the corner. While it’s not fun and no one enjoys compiling their paperwork for their accountants or tax preparers, it’s simply a part of being a citizen.
As the new tax mandate begins this year, there are still some specific questions about how tax exemptions and reductions will add up for future filings. However, the homestead exemption is still available to Floridians and should be taken advantage of.
What Is a Homestead Exemption?
“Homestead,” legally speaking, generally refers to the primary residence of a taxpayer. “Exemption” is pretty straightforward – this refers to some sort of obligation being removed.
When we talk about homestead exemptions, then, we’re referring to the tax break associated with owning a home. Florida’s property taxes are often considered high compared to other states but the homestead exemption helps alleviate some of the residential tax burden.
Homestead exemptions are not unique to Florida. In fact, all but 4 U.S. states (Delaware, Rhode Island, New Jersey, and Pennsylvania) have some kind of homestead exemption allowance. Each state is granted the ability to tailor their exemption based on other tax laws.
How Much Is Exempt?
In the state of Florida, the homestead exemption allows homeowners to reduce the taxable value of their homes by as much as $50,000.
In Florida, the homestead exemption amount is calculated with a complex equation that involves the market value of your home, the assessed value, and a few other factors. Depending on the market value and assessed value of your home, you could deduct up to $50,000 from the taxable value of your primary home.
Who Is Eligible for Homestead Exemptions?
Homeowners (this refers to anyone who owns a free-standing house, condominium, co-op apartment, or some mobile homes) who legally owned their homes as of January 1 are eligible to file for a homestead exemption.
In the state of Florida, residents must file for these exemptions. Unlike other states, failure to file means you will be ineligible to claim these deductions on your upcoming taxes.
Each year, the deadline to apply for a homestead exemption is March 1. While it is possible to file a late application, it’s not advisable.
In addition, a Homestead Exemption is not transferable. You must personally file a new application even if you received an exemption for the previous year but established a new residence prior to January 1. Additionally, if you purchased your property after January 1, and your TRIM notice reflects a Homestead, this is an exemption which was granted to the prior owner. This exemption ceases on December 31 of that year.
If you wish to qualify for a continuing homestead exemption, you must file an original application by March 1.
Where Do I File?
You must apply for and file your homestead exemption application with a county property appraiser. The appraising office will review your application and approve or deny it, and then alert the state.
At Thomas Group Realty, we recommend working with local appraiser Ed Crapo, CFA, ASA, AAS. Ed and his team have extensive knowledge regarding all things property tax-related and beyond.
If you’re a homeowner and want to apply for a homestead exemption, don’t delay! The deadline is fast approaching and will be here before you know it. Don’t miss your opportunity to save a little on your tax bill.
Looking for a new home this year? We can help! Our agents are 100% committed to helping our clients find the perfect place to settle in. Tell us about your dream home – we’ll set out to find it for you.