Florida's homestead exemption saves taxpayers money in two ways:

1. Up to $25,000 is deducted from the assessed value of a qualified property saving owners as much as $725 per year in Miami-Dade County.
2. Beginning with the second year of continuous homestead exemption, increases in the qualified property's assessed value is limited to 3% above the prior year's assessment (excludes additions, new construction, and unqualified areas of property). Over a period of time the tax savings accruing from the homestead limitation becomes significant (the 2005 average assessment limitation tax savings for a property with a homestead exemption in renewal status was $2,340).
   Unfortunately, during the past few years a number of homeowners have lost their tax savings from the homestead assessment limitation because they added or removed owners from the title of their homestead property by executing a deed. The property Appraiser's office is required by law to "reset" the limited assessed value of a property to full market value if a title changes occurs other than the ones listed here. Currently, Florida law allows only the following exceptions to the reassessment process: (Ref. section 193.155(3), Florida Statues):
   
   1. Subsequent to the change or transfer, the same person is entitled to the homestead exception as was previously entitled and:
      1. Transfers between legal and equitable title (Example: changing your property title into a life estate for yourself).
      2. Transfer of title to correct an error.
   2. Transfers between spouses.
   3. Transfers to spouses and minor children via a trust.
   4. Upon the death of the owner, the transfer is between the owner and another who is a permanent resident and is legally or naturally dependent upon the owner.

Please seek legal advice before changing the title of your homestead property, it may save you thousands of dollars in taxes.


Source: Miami-Dade County Property Appraiser Office www.miamidade.gov/pa