Homestead in Florida: What Exactly Does it Mean?
Homestead Protection in Florida
If you have ever lived in Florida, or have considered purchasing property
in Florida, you have probably heard someone use the term, “homestead.”
Homestead is an important concept in Florida. It is so important, in fact,
that the homestead protections for homeowners and their families are written
into the Florida Constitution.
Homestead in Florida applies in three different contexts–tax exemptions,
protection from forced sale by creditors, and protection for the owner’s
spouse and minor children. The goal of all of the homestead protections
is to preserve the family home. With that in mind, let’s explore
each of the three different types of homestead protections in turn.
First: The Homestead Tax Exemption
A Florida homestead is entitled to a variety of annual tax exemptions.
While some of these exemptions are available only to certain types of
homeowners (elderly, low-income, veteran, active military), the main homestead
exemption is available to most Florida homeowners.
You can claim your property as your homestead for purposes of the homestead
tax exemption as long as the property is located in Florida and the property
is your permanent residence. A residence qualifies as permanent if you
intend to reside there indefinitely. When it comes to the homestead tax
exemption, there is no limit on the acreage that can qualify.
In general terms, the homestead tax exemption means that the first $25,000.00
of assessed value of the property is exempt from taxes, and the exemption
can increase up to another $25,000.00 if the property’s assessed
value exceeds $50,000.00.
Second: The Homestead Protection from Forced Sale by Creditors
In Florida, a homestead property is protected from being sold to satisfy
the judgment of a creditor (someone to whom you owe money). To qualify
for this type of homestead protection, the property must be located in
Florida and must be your permanent residence. Here, however, there are
acreage limitations on the size of the property that can be protected
from forced sale.
A homeowner in a city can protect a homestead of up to one-half an acre
of land that is used as a residence. Outside of a city, a homeowner can
protect up to 160 contiguous acres of land. A homestead located outside
of a city may include property that is not used for residential purposes,
such as a farm or business. These acreage limitations apply only to the
forced sale type of homestead protection.
Be aware that the forced sale protection does not extend to all creditors.
A property that would otherwise be protected from forced sale is subject
to being sold to pay (1) taxes and assessments on the home; (2) a promissory
note on a mortgage; and (3) a lien for work performed on the property.
Third: The Homestead Protection for Spouses and Minor Children
Keeping in mind that the goal of all of the homestead protections is to
keep people in their homes, let’s look at the third type of homestead
protection. This type of homestead protection restricts a homeowner’s
ability to sell or devise (give by will) the homestead out from under
a spouse or minor children.
A married owner of a homestead cannot sell, give, or mortgage the homestead
to anyone without the consent of the owner’s spouse. An exception
exists where one spouse is conveying the property to himself and his spouse.
This restriction on selling, giving, or mortgaging the homestead applies
to protect only the spouse; here, there is no protection of minor children.
The word “devise” is a legal term that means the giving of
a person’s property to someone upon death by means of a will. A
homestead owner may not devise the homestead at all if the owner is survived
by a spouse or a minor child. If there are no minor children, the only
person to whom the property may be devised is the surviving spouse. However,
if the surviving spouse has formally waived his/her homestead rights in
the property, then the homeowner is free to devise the homestead to anyone else.
If you want to know how to best take advantage of homestead protections
in Florida to safeguard your assets, call The Edwards Law Firm today.
Contact a Sarasota real estate lawyer
if you need experienced legal representation using the Florida homestead