Portability in Property Tax Reform -- What Does It Mean?

Effective January 1, 2007, homestead property owners in Florida could transfer all or part of their accumulated savings to another home purchased in Florida.

These questions and answers aren’t meant as a comprehensive explanation of the Portability provisions. We hope they serve to focus your attention on how Portability works in the majority of cases. See the visual chart at bottom.

•Do I have to sell my previous homestead before I qualify for portability?

◦No. The previous homestead must have been abandoned by all homesteaders, but there is no requirement that the property be sold.

•What is the deadline for filing for portability?

◦A homeowner must establish a new homestead within two assessment years of abandoning a previous homestead, NOT two years from the date of sale or the date you moved from your previous homestead. If you received your last homestead exemption is 2008 you must be approved for your new homestead by January 1st of either 2009 or 2010 in order to qualify for portability.

•What does “upsizing” mean?

◦When the Market Value of your new homestead is the same as or greater than the Market Value of your previous homestead you can transfer up to $500,000 in Save Our Homes Cap value.

•What does “downsizing” mean?

◦When the Market Value of your new homestead is less than the Market Value of your previous homestead your portability will be calculated using the ratio of the Market to the Assessed Value of your previous homestead (see example).

•What if my spouse and I divorce? Who gets the portability?

◦If the spouse leaving the homestead, (the grantor), deeds their interest in the property to the spouse remaining in the property, (the grantee), there is no portability available to the grantor.

◦If both former spouses retain ownership as joint tenants with right of survivorship the resident spouse retains the portability.

◦If both former spouses remain in title after the Dissolution of Marriage is recorded, by statute they become tenants in common. If one person remained in the homestead, the property would be reassessed on the following January 1st showing only 50% of the value subject to homestead and Save Our Homes. The former spouse who left the property would be entitled to transfer 50% of the Save Our Homes Cap to a new homestead.

•If my co-owner and I abandon our previous homestead and move to a new homestead owned solely by me can we transfer all of our Save Our Homes Cap?

◦No. Because both of you are not in title to the new property only you are eligible for a homestead exemption on the new property. You would only be allowed to transfer your share of the previous Save Our Homes Cap, in this case 50%. To transfer 100% of a Cap, all homesteaded owners of the previous homestead must move to the new homestead.

Published: Sarasota Association of Realtors Magazine, May 2009

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