Homestead Exemption Provides More Than Tax Savings


  When you think of Homestead Exemption, you probably think about property taxes. The exemption can provide significant savings on property taxes, so if you bought a home in 2016 that became your permanent residence, you’ll want to be sure to file in the county where you reside to establish residency and qualify for the savings. Check with your county Property Appraiser’s Office - you may be able to file online with proper documentation. The deadline to file in Florida is March 1 for eligibility for the previous calendar year, and it will be here before you know it. Even if you moved into your home in December, the credit is for the entire year, so it could be costly to let the filing deadline slip by.

   Qualified seniors and disabled persons (including disabled veterans) may be eligible for additional savings, but are advised to apply in person the first time due to the need to provide supporting documentation.

  Beyond property tax savings, there are additional benefits to applying for your Homestead Exemption. In Florida, a homeowner who has filed for the exemption has nearly absolute protection from a forced sale to satisfy creditors.

  Four types of creditors can still force the sale of a homestead to collect debts owed to them. These are:

1. The State of Florida and its counties or municipalities, to collect past due property taxes (this also applies to investors holding tax lien certificates, but note the above prohibition against sale of small liens on homestead properties);
2. Parties to whom the property was specifically pledged as credit for a mortgage;
3. Mechanics who are owed money for work performed in repairing or improving the property.
4. Any creditor with a lien that pre-dates the establishment of homestead. This usually includes condominium and mandatory homeowner association liens, depending on the language and age of the covenants.
5. Federal Income Tax liens override state law, although the IRS typically leaves home seizure as a last resort

  Additionally, the exemption protects spouses. Homeowners are restrained from conveying a primary residence without their spouse’s approval, even if the spouse is not on the deed to the home and did not provide funds for the home’s purchase. It also guaranteed the right of a surviving spouse to remain in the home, even if the property is left to someone else by means of a will. Further, the homestead exemption for property taxes automatically attaches to the surviving spouse, so the property will never be exposed to the creditors of either spouse because of the death of the other.

  Finally, the exemption only applies to a single residence, so second homes, vacation homes, investment properties and the like do not qualify. Laws can also vary from state to state, so be sure to check with the Property Appraiser where you live.

Source:Florida Dept.of Revenue