Real Estate Matters

There are two very important property tax relief efforts facing Florida voters in the coming months.  Although many residents see them as not going far enough to provide meaningful tax relief, I believe that both efforts are a signal to the Florida Legislature that property owners in Florida are demanding property tax relief.

The first effort is the property tax relief constitutional amendment voters will consider during the state's primary election of January 29th.  Referred to as Amendment 1, which is the only amendment on the ballot, it calls for $25,000 tangible personal property exemption for small business on items such as business equipment and other tax breaks for property owners.  It will double the homestead exemption for almost all homeowners, providing an average savings of about $240 annually. The new exemption applies fully to homesteads valued over $75,000 and partially for homesteads valued over $50,000. This new exemption does not apply to school taxes.

It allows portability:  Portability will allow homeowners to transfer their Save Our Homes tax benefits from their old home to a newly purchased home. Portability applies to homes purchased in 2007 and later, and the benefit is capped at $500,000.

If you upsize, you will be able to apply the dollar value of your Save Our Homes tax benefit to your new home.  If you downsize, you will be able to apply the percentage of the Save Our Homes benefit to your new home.

The Amendment will provide an assessment cap of 10% for all properties, not previously capped: While homestead properties are already capped at 3%, now all other properties, including rental properties, second homes, and business properties, will be protected from huge increases in valuation. This new exemption does not apply to school taxes. 60% approval by voters is needed for passage on January 29th. It may not be enough, but it is a beginning.

The second property tax reform program is a petition being circulated that is referred to as the "1.35 Percent Solution" which would cap taxes at 1.35 percent of assessed value on all property while keeping current homestead and Save Our Homes exemptions.  Reform organizations are in a rush to collect signatures on the petition.  They need 550,000 signatures by the end of January in order to get the proposal on the ballot in November of 2008. 

Some believe that if Amendment 1 passes in January that the political wind will be gone to take the tax reform to a new level.  I disagree and think that passage will signal state wide momentum for tax relief.  Recently I was installed as 2008 President-Elect for the Sarasota Association of Realtors and I look forward to the Association taking a leadership role in this vital effort in protecting property values in Florida.  I urge everyone to support both of these efforts. 

I also wish all a very happy and peaceful holiday season and best wishes for 2008.