Florida voters approved a constitutional amendment expanding the homestead exemption, increasing the portion of a primary home’s value shielded from property taxes. The change phases in over two years, while most residents who move to Florida after a year-end deadline will have to wait five years to qualify for the larger benefit.
Key takeaways
- The exemption is set to rise from $50,000 to $150,000 in 2027 and $250,000 in 2028.
- Taxes earmarked for public schools are not affected by the expansion.
- Most new residents establishing Florida residency after Dec. 31 face a five-year wait for the expanded exemption.
- The amendment also limits annual increases in taxable values for second homes and investment properties.
The measure cleared the 60% voter-approval threshold required for a constitutional amendment, with support reported at about 62%. Its effects will differ depending on property type, residency status and local tax rates.
How the exemption changes
The homestead exemption reduces the taxable value of an owner’s primary residence. Under the approved schedule, the exemption increases to $150,000 in 2027, then to $250,000 in 2028. For a qualifying home assessed at $500,000, the larger exemption would leave $250,000 of value subject to applicable property taxes, before other adjustments.
The school-tax portion of a property bill is excluded from the change and will continue under existing rules. As a result, homeowners’ total savings will depend on local tax rates and the share of their bills allocated to other purposes.
Residency rules could shape who benefits
The amendment includes a five-year waiting period for most people who establish Florida residency after Dec. 31. Those who miss the deadline may not receive the expanded exemption until their fifth year as Florida homeowners. The rule is intended to distinguish established residents from newcomers seeking the tax benefit soon after moving.
That restriction could matter to people weighing a move from higher-tax states, as well as to households deciding when to make Florida their permanent home. The exemption applies to a primary residence, not simply to ownership of property in the state.
Potential effects on investors and local budgets
The measure also limits how quickly taxable values can rise each year for second homes and investment properties. That provision could affect future tax bills for owners of non-primary residences, although the exemption expansion itself is focused on homesteaded homes.
Property taxes help pay for local services, including emergency response, infrastructure and community programs. The amendment does not eliminate those taxes, but a larger exemption could reduce taxable value for qualifying homes. The measure’s impact on local revenues and individual bills will depend on how tax rates and property values evolve.