SOH
The Florida Save Our Homes (SOH) Act was passed in 1995 in order to help protect Florida residents from the tax burden of rising property values. Florida home owners are allowed to claim their primary residence as a homestead which is entitled to exemptions when calculating property taxes. In short, resident owners pay less in property taxes than their non-resident owner neighbors, AND those savings accumulate over time.
The Problem
Because the financial benefit of Homestead Exemption accumulates over time, long-term Florida residents had found themselves in a conundrum when they considered selling their old home and buying another, because they used to lose the accumulated benefit of their current homestead. In doing so, their property taxes increased significantly.
The Solution
To empower homesteaded homeowners to keep their accumulated homestead benefits (up to $500,000) when purchasing a new home, Florida passed the Transfer of Homestead Assessment Difference in 2007, more commonly referred to as Tax Portability. This results in significantly lower property taxes levied on residents who qualify because it allows them to transfer their accumulated assessed value savings up to $500,000.
Qualifying for Tax Portability
Florida homeowners who’ve sold a homesteaded property can port their property savings to another property within two years of selling their home. The savings is applied to their new homestead, whether that be a home recently purchased or another property they already owned. This benefit awards Florida residents very significant savings.
File Form DR-501T
Tax Portability may not be automatically awarded when claiming homestead on your new home, so be sure to apply for it. Homeowners are required to file form DR-501T - Transfer of Homestead Assessment Difference with their county’s property appraiser. Links here to the Hillsborough County DR-501T or the Pasco County DR-501T.
For more information review this FAQ and contact your county's property appraiser’s office.
If you're interested in a no-obligation evaluation of your options for selling your current home and buying a new one, contact me today.
