Save Our Homes: Tax Portability for Your Home in South Florida.
As buyers have started to feel the ‘itch’ to buy something, whether it be move up or move down buyers, the Florida Portability Tax Law is a constant question we receive. So I thought I should discuss it again.
Below you see a spreadsheet showing both the Portability benefit for Downsizing and Upsizing. I have included a short explanation.
Downsizing from your home Pinecrest, Palmetto Bay, Coral Gables or Coconut Grove:
You sell your current Florida home that has an Assessed Value of $900,000 and a Market Value of $1,250,000. You take the Market Value - Assessed Value and find your tax benefit ( $1,250,000 – $900,000 = $350,000 in Tax Benefit). You buy a new home for $800,000. The $350,000 Save Our Home tax benefit is applied to the new homes’ Market Value to create a lower Assessed Value. See the spreadsheet below for upsizing.
So if you own a home in Pinecrest, Palmetto Bay, Coral Gables or Coconut Grove and are looking into downsizing to a condo on the water in either Miami Beach, Coconut Grove or Coral Gables, a dramatic change in property taxes may not be something to worry about. Those homeowners, who sell one home in order to move into another full time, will find that the taxes on their new property are adjusted to reflect the savings from their old home.
|Portability - Calculating the Homestead Assessment Difference|
|Generally, there are two major components in calculating portability known as upsizing and downsizing. Here is how it works:
The maximum portable benefit is $500,000.
Applying for portability: