Property taxes are a fact of life in Florida, as in every state. The state of Florida requires you to pay property taxes if you own “real property,” meaning land and any fixed property, like a house.

As a homeowner looking to save, you might have heard of the Florida homestead exemption. Most people aren’t eligible to fully avoid property taxes, but you might be able to save a few thousand dollars in taxes with the homestead exemption. 

To own a “homestead” in Florida is to own real property (no more than half an acre in a municipality or 160 acres in an unincorporated county) as your permanent residence. 

Homesteading in Florida excludes rental properties or vacation homes because the property needs to be your or one of your dependents’ primary residence. 

In this article, we’ll clarify what a homestead exemption is in Florida, who qualifies, how to apply, and what happens if you’re no longer eligible. 

What Is the Homestead Exemption in Florida?

The homestead exemption is a limited property tax break in Florida that the state offers based on your home’s assessed value. The state has offered this tax break since the 1934 passing of the Homestead Exemption Amendment to the Florida Constitution, but it has since increased the property value limit that you can exempt.

Every year, you owe the state property taxes as a homeowner. After you apply for the homestead exemption in Florida, you can benefit from reduced property tax each year that you qualify. 

The homestead exemption in Florida reduces your property’s taxable value by up to $50,000, depending on how much your property is worth. The homestead exemption doesn’t decrease the market value of your home when you’re looking to sell or figure out how much home insurance to get. 

To determine the taxable value of your homestead property, the county property appraiser first looks at your home’s market or just value. 

Next, the property appraiser determines the assessed value of your home by taking the just value and subtracting any assessment limitations earned from the Save Our Homes (SOH) benefit, which we’ll discuss in the next subsection.

Finally, the property appraiser adds your homestead exemption to the assessed value, forming the taxable value. This value determines how much tax you owe for your property. 

We’ll get into how your homestead exemption is calculated under the section “How Does the Florida Homestead Exemption Work?” below. 

What Is the Save Our Homes (SOH) Benefit?

After a year of having the homestead exemption in Florida, you also automatically qualify for the SOH benefit assessment limitation. 

This “assessment limitation” restricts the yearly increase of your property’s value to 3% or the change in the Consumer Price Index, whichever is lower. The Consumer Price Index measures how all US prices change over time on average. 

The just value of your home can increase by much more than 3% in a year, but your property’s assessed value will always be lower because of the SOH assessment limitation. Over time, the SOH benefit can save you thousands of dollars because the difference between the just value and assessed value accumulates year after year. 

For example, on average, single-family homes in Florida from 2021 to 2022 increased in just value by $54,500 or about 15.7%. With the SOH benefit, your home’s value in the eyes of tax collectors (i.e., your property’s assessed value) would have increased by no more than 3%, which would be $10,440 in the 2021–2022 example.

What Is SOH Portability, and How Do You Transfer Your Benefit?

If you move to a new homestead, you may be able to transfer, or “port,” all or a portion of your accumulated SOH benefit to your new home. You may transfer up to $500,000 of your SOH benefit to a new homestead. 

Transferring the benefit over to a new home is called portability, and it lowers the taxes you owe on your new home. 

To transfer your benefit to a new homestead, you need to meet the following requirements:

  • Qualify and apply for a homestead exemption for your new property within three years from January 1 of the year you left your previous homestead—not three years from the sale date.
  • File a Transfer of Homestead Assessment Difference form (DR-501T) alongside your homestead exemption application (DR-501) by March 1. 

The exemption you claimed on your old homestead does not transfer to the new owners, so they will have to apply for a new homestead exemption. 

How Does the Florida Homestead Exemption Work?

The Florida homestead exemption doesn’t just slice up to $50,000 off your home’s assessed value. Instead, the homestead exemption breaks your home’s assessed value into four sections, taxing them differently. 

With the Florida homestead tax exemption:

  1. You do not need to pay any property taxes on the first $25,000 of your home’s value ($0 to $25,000).
  2. You have to pay all property taxes on the second $25,000 of your home’s value ($25,000 to $50,000). 
  3. You are exempt from all property taxes except school district taxes on the third $25,000 ($50,000 to $75,000), 
  4. You have to pay all property taxes on any value over $75,000.  

Examples of the Florida Homestead Exemption

The homestead exemption in Florida is easier to understand with concrete examples. 

Below are some possible scenarios to show how the homestead exemption applies to different property values. 

  • Property with an assessed value of $60,000: 
    • The first $25,000 would be fully exempt from all property taxes. 
    • The next $25,000 would be fully taxed. 
    • The remaining $10,000 would be exempt from all taxes except school district taxes. 
  • Property with an assessed value of $80,000: 
    • The first $25,000 would be fully exempt from all property taxes. 
    • The next $25,000 would be fully taxed. 
    • The next $25,000 would be exempt from all taxes except school district taxes. 
    • The remaining $5,000 would be fully taxed. 
  • Property with an assessed value of $300,000: 
    • The first $25,000 would be fully exempt from all property taxes. 
    • The next $25,000 would be fully taxed. 
    • The next $25,000 would be exempt from all taxes except school district taxes. 
    • The remaining $225,000 would be fully taxed. 

Homestead Exemption Requirements in Florida: How to Qualify

Anyone who meets the following Florida homestead exemption rules is eligible to apply:

  • You own a homestead.
  • The property is your permanent residence OR the permanent residence of a person you claim as a dependent on your taxes. 
  • You don’t currently have a homestead exemption claimed somewhere else (you can only have one homestead exemption at a time).
  • You lived on the property on January 1 of the tax year you’re claiming an exemption for. 
  • You did not rent the property out for more than 30 days in a given calendar year. 

How to Apply for the Homestead Exemption in Florida

You can apply for the Florida homestead exemption in one of three ways:

  1. File the homestead exemption application form (DR-501) online through your county property appraiser’s website. 
  2. Fill out the homestead exemption application form and mail it to your county property appraiser’s office.
  3. Visit your nearest property appraiser’s service center to file the application in person. 

Whether you apply online or in person, the Florida homestead exemption application form will ask you to prove your residence. You can use any or all of the following pieces of information to do so:

  • Florida driver license or ID card number
  • Florida voter registration number
  • Address on your last IRS tax return
  • Bank statement and checking account mailing address
  • Proof of payment of utilities at homestead address
  • Immigrant documents if you are not a US citizen

The form encourages you to provide as much information as possible to help your county property appraiser decide your eligibility. 

When to Apply for the Homestead Exemption in Florida

The yearly deadline for all Florida home tax exemption applications is March 1, but you don’t need to apply for the homestead exemption every year. After you qualify for the homestead exemption once, your county property appraiser will automatically renew your exemption each year as long as you continue to qualify.

Filing Late for Your Florida Homestead Exemption

You may file for your homestead exemption in Florida late as long as you can explain your circumstances. The late application deadline is 25 days after the property appraiser mails the Notice of Proposed Property Taxes document, typically in August.

Do Both Owners Have to Apply for Homestead Exemption in Florida?

Assuming a married couple has made one property their permanent residence, they can only apply for one homestead exemption. However, both spouses should sign the same application in order to ensure the exemption transfers to a surviving spouse in case the other spouse passes away. 

Can You Lose the Homestead Exemption in Florida?

Yes, you can lose your Florida homestead exemption if you no longer live permanently at your homestead. 

Your county property appraiser has a few ways to determine if your homestead status changes, so make sure you don’t do the following without notifying the appraiser’s office:

  • Rent out your property for over 30 days in a calendar year.
  • Allow your homestead exemption receipt to return to the property appraiser’s office because you no longer live at the address it was sent to.
  • Buy a new home or sell your home.
  • Change the ownership on the deed to your house. 
  • Claim a homestead exemption somewhere other than you or your dependent’s permanent residence. As one person, you can only have one homestead exemption total.

What Happens If You No Longer Qualify?

If you no longer meet all of the requirements to have a homestead exemption in Florida, it is your responsibility to notify your county property appraiser that you are now ineligible. 

Failing to report your ineligibility for a homestead exemption in Florida you previously qualified for could result in serious financial consequences. 

If you do not report that you are ineligible, tax collectors could do the following:

  • Retroactively collect your exempted taxes and SOH benefit.
  • Charge you a penalty of 50% of your exempted taxes.
  • Charge an additional 15% interest per year that you withheld your ineligibility. 

Other Property Tax Exemptions in Florida

If you’re looking for more ways to lower your property taxes in Florida, you may qualify for other more specific property tax exemptions, depending on your situation. 

The following are other Florida property tax exemptions and their application forms:

  • Assessment Reduction for Living Quarters of Parents or Grandparents: If you construct additional living accommodations for your home for an older family member, use this application form to claim an exemption. Just remember to reapply for this exemption every year.
  • Senior Citizens Exemption for Persons Age 65 and Over: Depending on your county, you may be eligible to apply for this exemption if you are at least 65, have lived in Florida for at least 25 years, are below a certain income threshold, and own a home worth less than $250,000. If you qualify, you are 100% exempt from property tax. Apply with this form.
  • Deployed Military Exemption: If you are in the military, own a homestead, and were deployed outside of the US in the last year, Florida provides an additional exemption depending on how many days you were deployed for. Apply with this form.
  • Total and Permanent Disability Exemption: If you are diagnosed with one of various disabilities (including blindness, quadriplegia, hemiplegia, and others), you may be eligible for a $500 property tax exemption. You need a physician’s certification and the Florida homestead exemption form to apply for this exemption.

Contact your county property appraiser to receive the application forms for the following exemptions: 

  • Exemption for Surviving Spouses of First Responders Who Die in the Line of Duty: Florida’s Fallen Heroes Act gives more information on this exemption for people whose spouses were killed in military service. 
  • Disabled Veteran Exemption: If you are at least 65 and had an injury in combat, you may qualify for an exemption on top of the other exemptions. 

Home, Sweet Homestead Exemption

Being a homeowner comes with plenty of responsibilities and costs, so taking advantage of benefits like the homestead property tax exemption is helpful. 

Plus, if you know the extent of Florida’s homestead exemption, you can encourage your friends and loved ones to find out if they qualify. 

Understanding the homestead tax exemption in Florida, the Save Our Homes benefit, and the details to maintain your eligibility can save you thousands yearly on property taxes. 

With your savings, you can spend more on what matters most to you and your family.