Homestead is more than just tax savings
Q: I acquired a house with my fiance in January which is our permanent residence. When can I claim the house as homestead so we can save on our property taxes?
A: Florida Homestead law was designed to protect the family home for its owner, as well as his or her heirs. Although most homeowners are familiar with the tax savings component of homestead protection, there are two others that can be even more important: protection from forced sale by creditors, and restrictions on selling or devising homestead property.
To qualify for the tax exemption, the homeowner must be a permanent resident of Florida, must hold legal title to the property, and must occupy the property as a permanent residence. Permanent residency must be established on or before Jan. 1 to apply for homestead that year. The deadline for application is March 1, so for those who made their permanent residence on or before Jan. 1, the deadline is next week. The application can be made online at www.leepa.org.
Florida has long been known as a great choice to be a permanent resident because of the creditor protection a homestead provides. This protection takes effect upon making the house your homestead. You and your fiance likely own the property as tenants in common, which means you each have a 50 percent interest. Each of those 50 percent interests would be protected, so long as both of you were homesteaded. If your fiance has a permanent residence at another property either in or out of state, only your 50 percent interest would be protected. There are a few exceptions to this protection, such as IRS liens and, in some cases, bankruptcy.
The third homestead protection is designed to protect the spouse and children from sale of the family home. Once you are married, you will not be able to transfer your share of the property without consent of your spouse.
Florida Homestead law, while very beneficial to those who claim it, can also be very complicated. Professional guidance should be sought to fully understand how homestead applies to your situation.
Eric P. Feichthaler has lived in Cape Coral for 27 years and graduated from Mariner High School in Cape Coral. After completing law school at Georgetown University in Washington, D.C., he returned to Southwest Florida to practice law and raise a family. He served as mayor of Cape Coral from 2005-2008, and continues his service to the community through his chairmanship of the Harney Point Kiwanis Club KidsFest, which provides a free day of fun and learning to thousands of Cape Coral families, and funds numerous scholarships. He has been married to his wife, Mary, for 13 years, and they have four children together. Recently, he earned his board certification in Real Estate Law from the Florida Bar. He is also a Supreme Court Certified Circuit Civil Mediator.
This article is general in nature and not intended as legal advice to anyone. Individuals should seek legal counsel before acting on any matter of legal rights and obligations.