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FINALLY...SOME TAX RELIEF!
Posted by V.K. [Mel] Melhado P.A. on Wednesday, October 31st, 2007 at 4:51pm.Finally, after a great deal of debate between the Florida House and Senate, a much sought after tax reform bill was passed. Now it is up to the voters in January to approve or disapprove the measure.
The nuts and bolts of the proposal are basically that the Homestead Exemption has doubled from $25,000 to $50,000 and the Portability issue has finally been addressed by providing statewide portability of the wildly popular Save Our Homes, (3% cap,) differential. A homeowner can now “port” the full amount of the differential if they are upsizing, however, if they are downsizing, the pro-rata share based upon market value of the new home as a percentage of the market value of the old home. There is a $500,000 cap on the amount to be “ported” and it is applicable to school taxes.
Here's how the portability would work: time. The house's just value is $500,000, but because of Save Our Homes,
the assessed value is only $200,000. Lisa buys a new house for $700,000.
The following year, she'll pay taxes on only $400,000, because she's
"porting" $300,000 in value to her new home.
Example B - Scott currently owns a home and has lived there for quite some
time. The house's just value is $500,000, but because of Save Our Homes,
the assessed value is only $200,000. Scott buys a new town home for
$300,000. He'll pay taxes only on $120,000 because when buying down in
value, he'll keep the same ratio of assessed value versus just value that
he enjoyed in his old home.
PS - remember that $500K is the maximum in benefit you can port.
If it sounds a bit confusing it is, but the good news is that the legislature addressed the issue and now we are relatively free to move about the State without suffering to many consequences, such as our taxes rising by three times our current amount.
V.K. [Mel] Melhado PA
Downing-Frye Realty, Inc.
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