Property taxes are a big worry for many in Florida. The newly approved Florida amendment aims to bring changes starting in 2025. But what do these changes mean, and how will they affect homeowners? Let’s break down Florida’s new property tax rules and see how they could shake up your finances.
What is Florida Amendment 5?
Florida amendment 5, approved by voters in 2022 with strong support, adjusts the second $25,000 of the homestead exemption to match changes in the Consumer Price Index (CPI). This annual adjustment helps the exemption keep up with inflation, providing homeowners with increasing tax relief as living costs go up.
How the Florida Homestead Exemption Works
Throughout Florida, homeowners who use their property as their primary residence may qualify for homestead tax exemptions.
Currently, the homestead exemption structure is:
- The first $25,000 of a home’s value is tax-free.
- The second $25,000 is taxed.
- The third $25,000 is tax-free, except for school taxes.
Starting in 2025, the second $25,000 exemption will grow with inflation, helping homeowners save more over time. As living costs increase, the exemption amount will also rise, reducing the taxable value of a homeowner’s property.
How much Homeowners will save?
Homeowners, especially in expensive areas like Broward County, will benefit most from Amendment 5. Initial savings may be modest—around $10 to $15 annually—but these could grow as inflation skyrockets.
For properties valued between $50,000 and $75,000, the amendment’s inflation exemption could provide substantial relief, saving homeowners hundreds of dollars annually.
Impact on Local Governments
Florida is getting ready to put Amendment 5 into action. This move could affect how much money local governments make. It’s estimated that in the 2025-26 fiscal year, there will be about $22.8 million less in revenue. This will affect most taxing authorities in the state, except for school districts.
This amount might seem big, but it’s actually a small part of the total property tax income. (Broward County witnessed a huge increase in property tax revenue last year). This shows that Amendment 5’s impact on local budgets is quite small under the Florida amendment.
What’s Next for Florida’s Tax System?
Florida’s Save Our Homes (SOH) amendment has been a huge win for homeowners. It limits how much property taxes can go up each year. For homes where people live, the increase is capped at 3% or CPI change, whichever is less. For other properties, the cap is 10%.
How Can we Help?
We’re here to help you figure out just how much you can save with the new inflation-adjusted homestead exemption, and make sure you’re getting every dollar you deserve.
For those in areas like Broward County, we’ll check out your property assessments, spot any exemptions you might be missing, and fix any mistakes that could be unfairly hiking up your tax bill. Because why pay more than you have to?
Contact JC Castle Accounting today to schedule a free consultation and let us help you keep more of your hard-earned money where it belongs—in your pocket.
