Florida’s Homestead laws provide significant benefits for homeowners. Designed to provide critical financial protection and security, these laws offer valuable tax exemptions and strong safeguards against creditors. It’s important to note, however, that these benefits come with specific restrictions—especially regarding inheritance and property transfer of which every homeowner should be aware.

Property Tax Exemption

Among the most notable benefits of Florida’s Homestead laws is the property tax exemption. This exemption enables homeowners to reduce the taxable value of their primary residence by up to $50,000. The first $25,000 applies to all property taxes, while an additional exemption of up to $25,000 applies to the assessed value between $50,000 and $75,000, excluding school taxes. There are additional exemptions available for specific groups, including veterans, surviving spouses, individuals with disabilities, seniors, first responders, and military personnel, among others.

In addition to this tax exemption, Florida’s “Save Our Homes” Amendment provides protection against rising tax burdens. For homes designated as homestead, property tax increases are capped at 3% per year or in line with the Consumer Price Index, whichever figure is lower, with certain exceptions. This significant safeguard means that even if market values soar dramatically, a homeowner’s tax obligation will only increase minimally.

Should homeowners choose to sell their homestead and acquire a new one, they may carry over a portion of any accrued tax savings—up to $500,000—to the new property. To qualify for this portability option, homeowners must establish a new residence on or before January 1 of the third tax roll year following the sale of their original property.

Creditor Protection

Another feature of Florida’s Homestead laws is broad creditor protection. In the event of financial difficulties, such as credit card or medical debt, the Homestead Exemption ensures that creditors cannot lien the property or force its sale to settle outstanding debts. This protection is among the strongest in the nation, playing a vital role in preserving the family home.

The Homestead Exemption not only protects homeowners during their lifetime but also extends to their beneficiaries upon the homeowner’s death. If the property is left to a certain class of beneficiaries, the Homestead Exemption remains in effect, safeguarding the home from creditors attempting to collect on the deceased’s debts. However, it’s important to note certain exceptions exist: Homestead properties remain vulnerable to claims relating to unpaid taxes, certain voluntary liens or encumbrances (such as mortgages), and obligations tied to home improvements or repairs.

Alienation, Devise & Descent

Florida’s Homestead laws also impose certain restrictions on the transfer of Homestead property, both during the homeowner’s life and after their death, primarily to protect spouses and minor children. Generally, homeowners cannot transfer Homestead freely if they are survived by a spouse or minor children. This provision ensures that family members do not lose their home and that the surviving spouse is adequately protected.

When Homestead is owned together by spouses, the surviving spouse inherits the entire property upon the death of the other spouse. If a homeowner passes away leaving a spouse and minor children, the spouse receives a life estate and descendants receive a remainder interest. Alternatively, the spouse may elect to inherit an undivided one-half interest in the property, with the children receiving the remainder. An improperly drafted transfer in a will or trust will be voided if it violates these restrictions.

In cases where a deceased homeowner is survived by a spouse and no minor children, they may only leave the Homestead to their spouse. However, if there are adult descendants, the same inheritance rules apply: the spouse receives either a life estate or an option for half interest, while the remainder goes to the descendants.

Only when a deceased homeowner is not survived by a spouse or minor children are they free to leave the Homestead to someone else. However, if the property is transferred to a non-heir, the Homestead Exemption is forfeited, allowing creditors to claim the property for the deceased’s debts. Contrastingly, heirs can inherit the property free from creditor claims.

Notably, homeowners cannot transfer or mortgage their Homestead without the participation of their spouse, further protecting the non-owner spouse.

While Florida’s Homestead laws provide valuable benefits—including property tax exemptions and creditor protections—it is crucial for homeowners to understand the restrictions related to inheritance and property transfers. Consulting with an experienced attorney can help you navigate these laws effectively, ensuring your rights and home are well-protected for the future.

BIOGRAPHY
Juanita Solis is an associate attorney at the Juno Beach law firm of Jeck Harris, specializing in estate planning, guardianships, probate and trust administration, and related litigation. A cum laude graduate of the University of Miami School of Law, Juanita is also a native of Colombia and fluent in Spanish.