Florida residents need to file for homestead. Why? Because it can save you lots of money in property tax. Here are the requirements:
- Florida resident
- Owner-occupied property
- No other homestead property anywhere in the world
- File by Jan 1 to qualify for savings that year
- March 1 filing deadline
- Obtain forms from local county property appraiser's office. BCPA.NET for Broward County
Florida has two types of property values: appraisal value and assessed value. In South Florida, all properties are appraised Jan 1 of every year. Assessed value is the appraisal value minus homestead exemptions. The amount of property tax you pay is calculated as assessed value x property tax rate. If you don't file for homestead, then you have no deductions and appraisal value equals assessed value.
So, now that you know the basics, what are the savings?
- Everyone who files receives a $25,000 exemption (appraisal value - $25,000 = assessed value)
- If the property is worth more than $75,000, owner receives an additional $25,000 deduction
- Individual counties have additional deductions for conditions such as blindness and other disabilities, low-income seniors, and widow/widowers. Check your local county property appraiser's office for a complete list.
- Homestead properties benefit from the Save Our Homes rule that caps assessed value increases to 3% a year. This allows homesteaded property owners to be protected from a rapidly rising real estate market. Their property taxes will remain relatively stable over the years. However, if the tax rate increases, their property tax will increase accordingly.
Don't wait to file the homestead forms. If you buy a home after Jan 1, go ahead and file for the following year. If you forget, it'll cost you.