Florida Property Tax News: Legislature Provides Tax Relief on Homestead Property Damaged or Destroyed by Misfortune or Calamity, Including Hurricanes

It’s an ill wind that blows no good.
--English proverb

The ill winds of Hurricane Katrina and Hurricane Wilma at least motivated the Florida Legislature to provide property tax relief to homestead residents. In rebuilding homestead property, no additional assessment valuation will be added to homestead property if the square footage is increased by 10% or less or if the building is rebuilt to 1,500 square feet or less.

This statutory amendment provides relief only where all or a portion of homestead property is damaged or destroyed by misfortune or calamity. Voluntary demolition and rebuilding not precipitated by misfortune or calamity does not qualify.

If, however, the damage or destruction of the homestead property results from misfortune or calamity, either of two circumstances will qualify for the relief provided. Because misfortune and calamity are not defined by the statute, it may safely be assumed that these terms will be applied by the courts in accordance with dictionary definitions, unless and until such definitions are narrowed by State Department of Revenue regulations.

Thus, misfortune and calamity may reasonably be understood to include fire, tornado, hurricane, flood and what are frequently referred to in legal documents and literature by the apparently faith-based terminology of “acts of God.”

Given the threshold requirement of misfortune or calamity, tax relief is provided by the Legislature under either of two separate sets of circumstances.

First, if the square footage changed or improved because of the misfortune or calamity does not exceed 110 percent of the square footage before the damage, no additional valuation will be added to the tax assessment roll for the homestead property in question.

In the alternative, and irrespective of the 110% rule, the assessed value shall not increase if the total square footage of the property after it is changed or improved does not exceed 1,500 square feet. This means that even if the house was, say, 1,000 square feet before the misfortune or calamity, rebuilding it to 1,500 square feet will not increase the taxable value. This is noteworthy from a practical standpoint, since it means even an increase of a full 50% or more in size, providing the end result measures 1,500 square feet or less, does not increase the tax base for the homestead property.

These two new statutes are also interesting from a constitutional standpoint. The Florida Constitution provides that all property must be assessed at market value, unless expressly provided otherwise in the Constitution. Market value means the amount that a willing buyer will pay to a willing seller, both fully informed as to the circumstances, and neither under duress to make the transaction.

The question that naturally arises is the following one. Will a 1,000 square foot house have the same market value as a 1,500 square foot house, all other things being equal? Clearly, the answer is no. as with many constitutional questions, this one may never be raised. Remember, legal eagles, only a person with a legally cognizable injury, otherwise known as standing, is authorized to pursue a lawsuit. Intellectual curiosity does not confer standing.

In summary, this new law provides that changes, additions, or improvements that replace all or a portion of homestead property damaged or destroyed by misfortune or calamity shall not increase the assessed value of the homestead if the square footage changed or improved does not exceed 110 percent of the square footage before the damage. Also, the assessed value shall not increase if the total square footage of the property after it is changed or improved doesn’t exceed 1,500 square feet.

The change allows for rebuilding homestead property damaged or destroyed to a total size of 1,500 square feet without any assessment increase. For such buildings the homestead property's assessed value shall be increased by the just value of that portion of the changed or improved homestead property that exceeds 1,500 square feet. That would in effect eliminate the 110 percent rule for properties of less than 1,500 square feet.

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Daniel A. Weiss is a former Attorney Special Master for the Miami-Dade County Value Adjustment Board with over 25 years property tax experience. Mr. Weiss represented the Miami-Dade County taxing authorities in litigation and appeals between 1981 and 1995 and has since represented taxpayers in property tax matters. Mr. Weiss was named one of the top lawyers in real estate, zoning and land use by South Florida Legal Guide 2007. In Florida Super Lawyers 2006, Weiss was named one of the top 6 local government lawyers in South Florida.

In Florida Trend magazine™'s Legal Elite's issue, July 2004, Mr. Weiss was selected by his peers as one of the top 30 government lawyers in the State of Florida.

For a free consultation regarding your property, contact us.

For More Information Click here

FLORIDA PROPERTY TAX NEWS: TOWN HALL MEETINGS REACH SOUTH FLORIDA

Florida property taxpayers are invited to inform their state legislators of their complaints and concerns. On February 12 and 13, taxpayers have the opportunity to speak directly to state lawmakers.


On February 12, State Senate and House members will host a public hearing from 6 to 9 p.m. in Building 6 of Broward Community College's central campus at 3501 S.W. Davie Road, Davie. On February 13, also for 6 to 9 p.m., the same State Senate and House members will be at Miami-Dade College, 300 N.E. Second Ave., downtown Miami, in the Chapman Conference Center.

For details, call 850-487-5920 (not toll-free) or visit www.flsenate.gov. Click on the ''Property tax reform'' icon on the right.
____________________________________________________
Daniel A. Weiss is a former Attorney Special Master for the Miami-Dade County Value Adjustment Board with over 25 years property tax experience. Mr. Weiss represented the Miami-Dade County taxing authorities in litigation and appeals between 1981 and 1995 and has since represented taxpayers in property tax matters. Mr. Weiss was named one of the top lawyers in real estate, zoning and land use by South Florida Legal Guide 2007. In Florida Super Lawyers 2006, Weiss was named one of the top 6 local government lawyers in South Florida.

In Florida Trend magazine™'s Legal Elite's issue, July 2004, Mr. Weiss was selected by his peers as one of the top 30 government lawyers in the State of Florida.

For a free consultation regarding your property, contact us.

For More Information Click here

HOMESTEAD EXEMPTION PROPERTY TAX "TRAP"

During the 2005 session of the Florida Legislature, the homestead property exemption "trap" was identified for the first time. The "trap" consists of the disincentive to relocation due to the consequences of loss of the Save Our Homes "cap" on property already owned combined with the prospect of purchasing another property, giving rise to reassessment and loss of the cap. Many residential property owners feel "trapped" in their present location since costs of the new property--even if a much smaller or much less-valuable property--exceed those of the existing property as a result of the property tax consequences.

The homestead property tax "trap" is the phenomenon which gave rise to no less than three proposals in the 2005 legislative session for "portability" in whole or in part of accumulated Save Ours Homes "cap" benefits accrued on property.

The consequences of the Amendment 10 "cap" are so extreme as a result of 12 years of application since inception that some properties, especially in South Florida, have an assessed or taxable value of less than 1/3 of the fair market value. This means that two identical homes adjacent to each other can--and sometimes do--have tax bills with a 200% variation even though their values and tax (i.e. millage) rates are identical!

Cases in point include the following.

Eileen Rennick, a widow, moved to Century Village in Deerfield Beach in 1999. She became accustomed to paying $104 a year in taxes on a one-bedroom condominium unit. But two years ago, when she moved across the street into a two-bedroom condo unit, her taxes increased by 900%, to $1,040 a year. "It's outrageous," Rennick said, adding that she would not have moved if she had been aware of the dramatic impact of the change in property taxes.

Randy Aube of Boca Raton would like to move to Broward County, but he's afraid he can't afford the taxes. He pays $4,300 a year in property tax on the house he has lived in for six years. If he moves and buys a place of similar value, his property taxes will triple to $14,000.

Aube wrote in a recent letter to State Representative Adam Hasner (R., Delray Beach), "My next-door neighbor, who bought his house a few years after I did, is paying about twice as much [in property taxes]. That just doesn't make any sense. I know this is a huge complicated problem, but if it doesn't get fixed, it's only going to get worse."

Upset about the homestead exemption property tax "trap," South Florida homeowners can address their concerns directly to state legislators of both parties at town hall-type meetings across the state in the ensuing months. Eight town hall-style hearings are scheduled. See this blog for dates and times of hearings in Fort Lauderdale and Miami during the second week of February.

The hearings will provided grist for the legislative mill in the upcoming session, which will start in March.

Newly-elected Governor Charlie Crist and many legislators want to reduce taxes people pay on their homes. They are discussing a constitutional amendment that legislators would propose and voters approve or disapprove in statewide elections to be held as early as this summer. The proposal, among other things, would double the current $25,000 homestead exemption, which lowers the assessed and taxable value of a home. Under the existing exemption, the owner of a $200,000 house pays property tax on $175,000 of that value. If such a proposal passes, the taxable value would be reduced to $150,000.

The Republican governor also wants to let homeowners take some or all of their so-called "Save Our Homes" tax savings if they move. A 13-year-old constitutional provision caps tax increases at 3 percent a year (or the cost-of-living increase, whichever is less) no matter how much the value of a home increases. But those savings are lost when a homeowner moves, and the cap doesn't apply to businesses, rental properties or vacation homes.

This month, Crist and legislators concurred on changes to cut property insurance rates. Property tax issues promise to be hinkier and more controversial.

Local government officials say tax cuts of any significance will reduce public funds avalable for local parks, salaries of police officers and firefighters and other essential public services.

Lauderdale Lakes Finance Director Larry Tibbs is among those who are worried. He says if homestead exemptions are doubled, his city alone would lose more than $1 million annually. Mr. Tibbs said, "To make up that difference, Lauderdale Lakes would have to raise the millage rate."

Consequences would be even worse for Miami-Dade County municipalities which have a stable and predominant tax base of homes owned by permanent residents. North Miami and South Miami quickly come to mind.

Governor Crist cogently suggests that local governments, which have expanded their budgets during the past several years due to swollen tax bases resulting from a booming real estate market, should pull in their belts and spend less.

"They are going to have to have a little more discipline at the local level to help the people," said Governor Crist.

Some Republican legislators joined the chorus of those calling for spending cuts by cities, counties and other taxing authorities. They say total property taxes levied at the local level ascended from $16.6 billion in 2001 to $30.4 billion in 2006, an 83.1% increase that nearly septupled the 12% population growth during the same period.

"Florida doesn't have a revenue problem. We have a spending problem,"
said Senator Mike Haridopolous (R., Indialantic), chairman of the Senate Finance and Tax Committee.

Palm Beach County resident Larry Zalkin, who serves on a county advisory board, agrees that it's time for Florida to reduce property taxes, even if it means slashing city and county budgets. "This is the ideal time to fix the situation" by sharing budget surpluses with the public which funded them, opined Mr. Zalkin.

The property tax debate is gaining momentum after fizzling during the 2005 legislative session. State legislative leadership says everything is on the table, even though House Speaker Marco Rubio insists any tax cuts be across the board and be combined with stringent spending caps for cities, counties and school districts.

"[Property tax cuts] have to help the owner of the apartment building, so that hopefully they'll pass it through to their tenant. It also has to help the owner of the laundromat or the dry-cleaning store at the corner," said Rubio (R., West Miami).

For better or worse, watch for the 2006 legislative session to study all, and implement some, of the proposals advanced by the Property Tax Reform Committee appointed last year by outgoing Governor Jeb Bush. The Committee was created by executive fiat after the 2005 session of the Legislature did little to address the property tax inequities engendered by the Save Our Homes constitutional amendment approved by Florida voters in 1994.

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Daniel A. Weiss is a former Attorney Special Master for the Miami-Dade County Value Adjustment Board with over 25 years property tax experience. Mr. Weiss represented the Miami-Dade County taxing authorities in litigation and appeals between 1981 and 1995 and has since represented taxpayers in property tax matters. Mr. Weiss was named one of the top lawyers in real estate, zoning and land use by South Florida Legal Guide 2007. In Florida Super Lawyers 2006, Weiss was named one of the top 6 local government lawyers in South Florida.

In Florida Trend magazine™'s Legal Elite's issue, July 2004, Mr. Weiss was selected by his peers as one of the top 30 government lawyers in the State of Florida.

For a free consultation regarding your property, contact us.

For More Information Click here

CELEBRITY PROPERTY TAX ASSESSMENT: JAMES POSEY

Ever catch a glimpse of Miami Heat forward James Posey hanging out in Coconut Grove? Ever wonder why he hangs there?

Well, for your information, he lives in the Grove. At Cloisters on the Bay Condominium, to be exact. See his tax assessment information below.

P.S. If you ever wondered who the appellate zoning attorney was who successfully defended the City of Miami's zoning approval for the Cloisters--what, you don't give a hoop? well, you're about to find out anyway--it was, drum roll, please: your own faithful blogger!


01-4121-227-0010
Property: 3471 MAIN HWY 515
Mailing Address: JAMES M POSEY JR

3471 MAIN HWY #515 MIAMI FL
33133-5929

Property Information: Primary Zone: 0100 SINGLE FAMILY RESIDENCE
CLUC: 0007 RESIDENTIAL- CONDOMINIUM
Beds/Baths: 3/3
Floors: 0
Living Units: 1
Adj Sq Footage: 5,090
Lot Size: 0 SQ FT
Year Built: 2002
Legal Description: CLOISTERS ON THE BAY CONDO UNIT 501 UNDIV 5090/152798 INT IN COMMON ELEMENTS OFF REC 20540-2365 COC 23900-2276 10 2005 1

Sale Information: Sale O/R: 23900-2276
Sale Date: 10/2005
Sale Amount: $2,170,000

Assessment Information: Year: 2006 2005
Land Value: $0 $0
Building Value: $0 $0
Market Value: $1,738,530 $1,738,530
Assessed Value: $1,738,530 $1,738,530
Total Exemptions: $0 $0
Taxable Value: $1,738,530 $1,738,530

____________________________________________________________________________________
Daniel A. Weiss is a former Attorney Special Master for the Miami-Dade County Value Adjustment Board with over 25 years property tax experience. Mr. Weiss represented the Miami-Dade County taxing authorities in litigation and appeals between 1981 and 1995 and has since represented taxpayers in property tax matters. Mr. Weiss was named one of the top lawyers in real estate, zoning and land use by South Florida Legal Guide 2007. In Florida Super Lawyers 2006, Weiss was named one of the top 6 local government lawyers in South Florida.

In Florida Trend magazine™'s Legal Elite's issue, July 2004, Mr. Weiss was selected by his peers as one of the top 30 government lawyers in the State of Florida.

For a free consultation regarding your property, contact us.

For More Information Click here

MARCH 1st IS FLORIDA’S FILING DEADLINE FOR AGRICULTURAL CLASSIFICATION & CHARITABLE, RELIGIOUS AND EDUCATIONAL EXEMPTIONS!

March 1 is the annual filing deadline for property tax exemption in Florida. This includes not only the homestead exemption, but also charitable, religious, educational scientific and literary exemptions, as well as agricultural classification.

Here are a few FAQs related to Florida's valuable exemptions and exceptions from full-value property taxation.

The Property Appraiser’s Office in each county administers property tax savings on properties that qualify for Florida’s exemptions. Eligible properties are those which are owned by a nonprofit entity and used exclusively or predominantly for qualifying non-profit purposes. If used exclusively for qualifying purposes, applicants otherwise eligible for exemption may find the taxes on the property wholly ELIMINATED, irrespective of its value. Note that nonprofit is not synonymous with 501 ©(3) classification under the federal Internal Revenue Code.
The two exceptions to this rule are educational and agricultural properties, which are discussed separately below.

Educational properties must be accredited educational institutions. If owned by a for-profit entity, tax savings must be passed through to the qualifying operator of the educational institution in order to be eligible for exemption. The property must be used exclusively—not just predominantly—for educational purposes in order to qualify. That said, the structure to be used for educational purposes need not yet be constructed, provided “affirmative steps have been taken to prepare the property for educational use” by January 1st of the tax year. Consult the county Property Appraiser or a property tax consultant to ascertain whether a particular property qualifies.

Agricultural classification is not an exemption but an exception to full value taxation. The benefits conferred may reduce the taxes on the property so dramatically that “ag” classification is frequently referred to as an exemption. In order to qualify, land must be used for good faith commercial agricultural purposes as of the January 1st assessment date. Because commercial use is required, nonprofit ownership is not a requirement. Again, consult the county Property Appraiser or a property tax consultant to ascertain whether a particular property qualifies.
For a more complete discussion of agricultural classification, go to your local law
library and consult Chapter 64 of Matthew Bender’s Florida Tax Service 2d, titled
“Agricultural and Other Classified Properties,” co-authored by your faithful
blogger.

To review a list of agricultural classification judicial decisions and opinions in
cases litigated by undersigned counsel,
click here.

Other special classes of property under Florida law are pollution control devices;
high-water recharge lands; conservation easements, environmentally endangered
lands, lands used for recreational or park purposes when land development
rights have been conveyed or conservation restrictions have been covenanted;
building renovations for accessibility to the physically handicapped; historic
property used for commercial or certain nonprofit purposes; historically
significant properties when development rights have been conveyed or historic
preservation restrictions have been covenanted; and mineral, oil, gas and other
subsurface rights (which are separately assessed from the other interests in
land).

The deadline for filing all applications for exemption and for agricultural
classification is March 1st each year. Bear in mind that FILING means actual
receipt by the Property Appraiser—NOT just mailing. The safest way to prove
date of filing is to hand-deliver and retain a date-stamped copy or mail with
return receipt requested.

I cannot tell you how many exemptions have been forfeited because an applicant could not prove filing of a timely application. A word to the wise is sufficient.
Finally, missing the March 1st filing deadline is no longer necessarily fatal to your claim. State regulations now provide for filing as late as August or September upon a showing of extenuating circumstances, provided that you also file a value adjustment board petition to trigger a hearing on your claim of extenuating circumstances. Consult a property tax consultant if such circumstances exist. Do not simply rely on the county Property Appraiser in such circumstances, since many are inclined simply to state that if you have not filed by March 1st, you have missed the statutory deadline. This statement, while accurate, is far from complete.
___________________________________________________________________________________
Daniel A. Weiss is a former Attorney Special Master for the Miami-Dade County Value Adjustment Board with over 25 years property tax experience. Mr. Weiss represented the Miami-Dade County taxing authorities in litigation and appeals between 1981 and 1995 and has since represented taxpayers in property tax matters. Mr. Weiss was named one of the top lawyers in real estate, zoning and land use by South Florida Legal Guide 2007. In Florida Super Lawyers 2006, Weiss was named one of the top 6 local government lawyers in South Florida.

In Florida Trend magazine™'s Legal Elite's issue, July 2004, Mr. Weiss was selected by his peers as one of the top 30 government lawyers in the State of Florida.

For a free consultation regarding your property, contact us.

For More Information Click here

FLORIDA PROPERTY TAX NEWS: MARCH 1 IS HOMESTEAD EXEMPTION FILING DEADLINE!

MARCH 1st IS FLORIDA HOMESTEAD EXEMPTION DEADLINE

March 1 is the annual filing deadline for homestead property tax exemption in Florida.

Here are a few FAQs related to Florida's valuable homestead exemption from property taxation.

The Property Appraiser’s Office in each county administers property tax savings on residential properties that qualify for Florida’s $25,000 homestead exemption.

For example, if your home has an assessed value of $100,000, the homestead exemption reduces its taxable value to $75,000.

Further tax relief on homestead properties, such as up to $5,000 for qualified disabled veterans, or $500 for widows or widowers, may also apply to your residence.

An additional $25,000 exemption for qualified senior citizens is now in effect for county residents who meet an income-level eligibility.

A panoply of additional homestead-related exemptions are available to disabled veterans, those legally blind, quadriplegic, hemiplegic, paraplegic or totally and permanently disabled so as to require the use of a wheelchair for mobility. Some of these exemption wholly ELIMINATE property taxation on the residence, irrespective of its value.

Confer with your county Property Appraiser or local property tax consultant to determine whether you are eligible for any of these valuable benefits.


The deadline for all new applications for homestead and other exemptions is March 1 each year. This includes instituitional exemptions, such as charitable, religious, educational and scientific. agricultural classification applications must also be filed on or before March 1.

The Property Appraiser’s Office also administers Florida Constitution Amendment 10 — Florida’s 3% cap on qualified homestead properties.

Florida limits any increase in the assessed value of a qualified homestead property to 3 % or the Consumer Price Index, whichever is lower. The cap does not apply to commercial property. When a homestead property is sold, the value returns to market value as of the following January 1. New additions or improvements are assessed at market value on January 1 following the year of construction. Thereafter, they are included in the 3% cap.

This Save Our Homes (SOH) cap can become far more valuable over time. Some Florida homes which have been homestead-exempt since the 1995 SOH start date are now assessed at less than 50%--some significantly less tan 50%--of their market value. For owners of some luxury homes, actual tax savings may amount to $100,000 per year or more!

So don't make the mistake of thinking that the homestead exemption affords only relief against $25,000 in assessed valuation.

Any questions? Contact your County Property Appraiser. Click here for contact information.

http://dor.myflorida.com/dor/property/appraisers.html

To be sure you're doing the most you can to keep your property taxes as low as the law allows them to be, contact a Florida property tax professional, whether it's a lawyer, real estate broker, accountant or other experienced professional.
____________________________________________________
Daniel A. Weiss is a former Attorney Special Master for the Miami-Dade County Value Adjustment Board with over 25 years property tax experience. Mr. Weiss represented the Miami-Dade County taxing authorities in litigation and appeals between 1981 and 1995 and has since represented taxpayers in property tax matters. Mr. Weiss was named one of the top lawyers in real estate, zoning and land use by South Florida Legal Guide 2007. In Florida Super Lawyers 2006, Weiss was named one of the top 6 local government lawyers in South Florida.

In Florida Trend magazine™'s Legal Elite's issue, July 2004, Mr. Weiss was selected by his peers as one of the top 30 government lawyers in the State of Florida.

For a free consultation regarding your property, contact us.

For More Information Click here

FLORIDA PROPERTY TAX NEWS: STATEWIDE TOWN-HALL MEETINGS

Florida property taxes are very much in the news these days. Of paramount interest are the ever-increasing dollar amounts paid by Florida property owners due to the recent boom in real estate. Also attracting legislative, public and press attention are the consequent inequalities created under Florida's Save Our Homes homestead exemption laws.

In response to these and other property tax issues, Florida lawmakers are scheduling town-hall meetings across the state in coming weeks to hear recommendations from the public on how to reduce property taxes.

According to state Senator Mike Haridopolos (R., Melbourne), Chairman of the Senate Finance and Tax Committee, those heading up the effort insist that "everything is on the table" when it comes to reviewing Florida's property tax system.

"There may be some very creative ideas for how we can address this problem," said Senator Don Gaetz (R., Niceville--yes, there is a Niceville in Florida, believe it or not), who joined Haridopolos and Representative Frank Attkisson (R., Kissimmee), in announcing plans to hold eight public hearings before the inception of the regular legislative session in March.

The first hearing is slated for Panama City in January 2007. In keeping with the town-hall format, the public is of course invited to attend and participate.

Sen. Haridopolos and Rep. Attkisson have their own point of view on the save Our Homes controversy. Both said that they're not in favor of revising the Save Our Homes tax cap, which has shifted more of the tax burden from homeowners to business and investment property owners over the years. The cap has also created great disparity in property taxes paid by newer homeowners compared to longtime homeowners.

An alternative point of view is that of House Speaker Marco Rubio. The Speaker is very interested in getting a property tax amendment on the ballot this year, Attkisson said. That means getting three-fourths of the Legislature to agree to put the amendment on the ballot for consideration by the voters of the state of Florida.

__________________________________________________________________________________
Daniel A. Weiss is a former Attorney Special Master for the Miami-Dade County Value Adjustment Board with over 25 years property tax experience. Mr. Weiss represented the Miami-Dade County taxing authorities in litigation and appeals between 1981 and 1995 and has since represented taxpayers in property tax matters. Mr. Weiss was named one of the top lawyers in real estate, zoning and land use by South Florida Legal Guide 2007. In Florida Super Lawyers 2006, Weiss was named one of the top 6 local government lawyers in South Florida.

In Florida Trend magazine™'s Legal Elite's issue, July 2004, Mr. Weiss was selected by his peers as one of the top 30 government lawyers in the State of Florida.

For a free consultation regarding your property, contact us.

For More Information Click here