5 Must Know about the Homestead Exemption

Here is some important info for our homebuyers who purchased their homes in 2024:

• Tax Savings

The Homestead Exemption helps save on taxes by reducing the taxable value of your primary residence. This means that the local tax assessor applies a lower value to your home when calculating property taxes. For example, if your home is valued at $500,000 and you qualify for a $50,000 homestead exemption, the taxable value would be reduced to $450,000. Since property taxes are calculated based on the taxable value, this reduction directly lowers your annual tax bill.

In some areas, the exemption also helps protect against significant increases in property taxes due to rising home values by offering a cap on how much the assessed value can increase year over year, providing long-term savings. This reduction can result in hundreds or even thousands of dollars in tax savings each year, depending on the value of your home and local tax rates.

• Asset Protection

In Florida, the Homestead Exemption provides strong asset protection by shielding the value of your primary residence from most creditors and lawsuits. Under Florida law, the homestead exemption offers nearly unlimited protection for the value of your home, meaning that if you face financial difficulties or legal judgments, creditors generally cannot force the sale of your primary residence to satisfy debts.
 

• To qualify, the home must be your primary residence, and you must be a U.S. citizen or permanent resident. Vacation homes or rental properties do not qualify for this protection.
• You must also live in the home as of January 1st of the tax year. 
• You must apply by March 1st of the tax year for which you're seeking the exemption. Late filings can result in missing out on the exemption for that year.

If you need assistance or have questions about how the homestead exemption impacts your financial situation, reach out to us, and we will refer you to real estate attorneys for personalized guidance and reliable solutions.

Christel Renaud | Christel Miami Luxury Living

954-799-3378 | [email protected]