Passing a family home to the next generation sounds simple, but in Florida, homestead laws add an extra layer of rules that many families overlook. In addition to protecting your residence from creditors and providing valuable tax breaks, these laws also restrict who can inherit the property and how it can be passed on.
A property qualifies as a homestead in Florida if it is your permanent primary residence on January 1 of the tax year. You must legally own the property and live in it full time.
In most counties, you must also file a homestead declaration to receive protections. If you recently moved to Florida, proof that you have ended residency in another state may be required.
Florida law shields homestead property from most creditors, protecting both the homeowner and surviving heirs. This protection stays in place after the death of the owner, which helps prevent forced sales during probate. However, this shield only applies to your primary residence, not to second homes or rental properties.
The homestead exemption can reduce the taxable value of a home by as much as $50,000. Florida also caps annual increases in assessed value at 3%, making property taxes more predictable. However, when a home is inherited, that cap resets, often raising the tax burden for the next owner unless they also qualify for the exemption.
Florida law limits how you can pass your homestead to others. If you are survived by a spouse or minor child, you cannot will the property to someone else.
In those cases, the home automatically passes to your spouse or enters into a life estate arrangement. You may only freely transfer the home through your will if no minor children or surviving spouse remain.
At Schnauss Naugle Law, we guide clients through Florida’s strict homestead laws to ensure their estate plans hold up. If you are unsure whether your home can be left to your intended heirs, we can review your options and help you make a plan that avoids conflict. Contact us today to get started.
