Property Taxes are a main source of revenue for the counties and state, since there is no income tax here in Florida. There are many differences vs. how property taxes are calculated in other states, so I've put together this guide to help you understand how it works.
Terms
Homestead - If your Florida home is your principal residence, you may declare it to be your Homestead. This provides certain reductions in your property tax bill, as explained below. This cannot be a property you have as an investment, with tenants.
Save Our Homes - The Florida Legislature created "SOH" to prevent people from losing their homes due to rising property values causing an increase in property taxes. The maximum property tax increase per year on homesteaded property is 3%.
Amendment 1 - Approved on January 29, 2008, this changes the Homestead exemption from $25,000 to $50,000, with certain exclusions for school taxes, and allows for portability of the SOH savings from one house to another.
Amendment 1 - The Math
If you are selling a home, and buying a more expensive home: You may transfer the entire SOH savings.
If you are selling a home, and downsizing into a less expensive home: You may transfer the SOH percentage you were saving on the larger home to the smaller home.
Buying a home - Don't Spend Time on Current Tax Info
When you are purchasing a home, don't pay much attention to the current property taxes on this property. The sellers may have lived there for a while, and build up a large SOH savings. You will pay that amount for the remainder of the tax year, but the change in ownership will trigger a new assessment, and many people are shocked with the news of their much higher tax bill.
CDD Fees (Community Development District)
Many subdivisions have additional fees called CDDs. This covers a bond which was used to pay for the roads, street lights, and common areas in developing the property, along with some on-going maintenance. The CDD is paid with your Property Tax bill and is calculated by the community, and added to the total tax due. In some cases, developers or property sellers have paid off the CDD on an individual property as a sales incentive. In many cases the bond is a 30 year bond.
Resources
The links below are to the County Property Appraiser websites. There you can look up the current taxes on a property, and calculate the estimated taxes on a property based on your anticipated purchase price. Note: Not all county websites have been updated with the calculation changes for the Amendment 1 changes.
Hillsborough County
Pasco County
Pinellas County
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