Purchasing real estate can be challenging when considering all the terms, requirements and loopholes. When buying in Florida, another thing to be aware of is the homestead exemption.
Florida is one of the few states that has this exemption, which is beneficial for homeowners. There are two types of homestead exemptions.
Homestead tax exemption
According to the Pinellas County Property Appraiser, the purpose of the exemption is to lower an owner’s property assessment value. The benefit is that this reduces the amount of property tax the owner must pay each year.
In order to qualify for the exemption, all property owners must present a driver’s license or ID, voter’s ID and car registration, all from the state of Florida. If the owner is not a citizen of the United States, immigration documents are also necessary.
The initial exemption is for $25,000, which applies to the first $50,000 of assessed value. If the value of the property is between $50,000 and $75,000, there is an additional exemption of $25,000. The first exemption applies to taxes, including those for the school district, but the second exemption does not apply to taxes for the school.
Homestead exemption for asset protection
According to FindLaw, another potential exemption is for asset protection, which shields the property from non-lien creditors. The property must be a primary residence, and if its location is within a municipality, only one-half acre of land applies for protection. If the property is outside of a municipality, up to 160 acres of land applies for protection.