It is no secret that Florida offers some of the best homestead benefits in the U.S. Homestead is one of the many reasons many people choose to retire in Florida. Most people have heard that Florida’s homestead law offers a tax exemption and creditor protection. However, many have never heard of Save Our Homes (“SOH”), which is an additional tax benefit to homesteading real property in Florida.
The way SOH works is that after the first year you receive a homestead exemption, the property assessments for tax purposes for each following year cannot increase more than three percent. As an example to how beneficial this can be, in 2022 and 2023, Florida real property skyrocketed in value. Each year, real property is reassessed to calculate the property tax rate, so property taxes went up significantly, many by double digit percentages. Those who purchased and homesteaded their properties in the years prior to 2022 saw significant tax savings due to SOH since the assessed value of their home for tax purposes could not increase by more than 3% per year. Save Our Homes is a long term tax benefit that keeps Floridians’ property taxes stable and prevents them from being taxed out of their homes because of skyrocketing market prices.
It should also be noted that SOH is a homestead benefit that can be transferred to a new residence. If you own a home where you are receiving the homestead exemption and you decide to move, your new home will not automatically become your homestead. Instead, you will need to reapply for homestead status on your new residence. At the same time as applying for homestead for your new home, the SOH assessment limitation from your old home can be transferred to your new home by including a Transfer of Homestead Assessment Difference (Form DR-501T) along with a homestead application (Form DR-501). The forms will need to be filed with your county property appraiser. The due date for filing these forms is March 1 of the first year after you moved to your new home.