The homestead exemption in Florida may refer to three different types of homestead exemptions under Florida law: .  Robbins, supra at 2. 2d 1315 (Fla. 5th DCA 1986).  Section 196.041(2), Fla. Stat. A trustee may be a beneficiary of the land trust for which such trustee serves as trustee." (see section 196.031, Florida Statutes) Homestead Property Tax Exemption The application for homestead exemption (Form DR- 501) and other exemption forms are on the Department’s forms page and on most property (1993). In that opinion, the trust agreement did not grant the beneficiary an interest for life, but for a term of years and the opinion concludes that, despite the fact that the settlor or beneficiary might otherwise meet the requirements of section 196.031(1), Florida Statutes, the beneficiary was not entitled to a homestead exemption. The first $25,000 in property value is exempt from all property taxes, including school district taxes. A beneficiary's interest in a land trust is generally deemed to be personal property. , This general proposition is consistent with a line of opinions rendered by this office that generally concluded that the interest of the beneficiary for ad valorem tax purposes was personal property unless the trust was a passive or dry trust. 2d 670 (Fla. 1951) and Wood v. Ford, 3 So. It is required by section 196.011 (1), Florida Statutes. In other words, under certain conditions, the death of the homestead owner and subsequent transfer of the property their direct heirs do not break or cancel the existing homestead protections.  See Robbins v. Welbaum, 664 So. THE HOMESTEAD EXEMPTION. However, residences owned by revocable trusts in Florida , including trusts declared under the Florida Land Trust Act, can be eligible for homestead protection as long as the beneficiary of the trust meets the other requirements.  M.D. I would note that the trustee of a Florida Land Trust may also be a beneficiary of the trust and under these circumstances would be entitled to claim a homestead exemption under section 196.031(1), Florida Statutes. "[a] person who otherwise qualified by the required residence for the homestead tax exemption provided in s. 196.031 shall be entitled to such exemption where the person's possessory right in such real property is based upon an instrument granting to him or her a beneficial interest for life . See also Florida National Bank of Jacksonville v. Simpson, 59 So. Proceeds from the Sale of a Florida Homestead. (e.s.) And see Op. When property is owned and used as a homestead by a person serving in the military, the service member may rent the homestead property without abandoning their homestead exemption. 2d 1161 (Fla. 4th DCA 1989). 2. Trusts: If title to the property on which you are applying is held in a trust, a copy of the entire Trust Agreement must be submitted, with the application. It is granted to those applicants with legal or beneficial title in equity to real property as recorded in official records who are bona fide Florida residents living in a dwelling and making it their permanent home on January 1 of the taxable year. The second $25,000 excludes School Board taxes and applies to properties with assessed values greater than $50,000. The Property Appraiser denied the application because the Welbaums did not hold a life estate in the property and thus, the property appraiser argued, did not qualify for homestead exemption because their use of the residence was limited by the QPRT. And see Op. If this were the case, a major asset of most people's estates would be left vulnerable to probate. Homestead. The homestead exemption in Florida can save you hundreds of dollars in property taxes if you are a permanent Florida resident. 2d 751 (Fla. 1952). VII, s. 6(d), Fla. Likewise, property held in a Florida land trust may qualify as a Florida homestead. Homestead Protection: With Florida Land Trusts, you can protect your property with homestead exemption. Provide your email address below to receive the Attorney General's Week In Review featuring the latest news and updates on top issues. Stat., defines "[b]eneficiary" to mean "any person or entity having a beneficial interest in a land trust. " ), This office cannot declare a statute unconstitutional or advise any officer to disregard a legislative direction or mandate. 196.031(1), and 196.031(3)(d), Fla. Stat. . Most Florida counties have special requirements to maintain the homestead tax exemption and special language may be required in the trust agreement and the deed. Owners of residential rental property may wish to conceal their ownership from tenants so that the tenants must deal with a property manager instead of bothering the owner.  See Title, Ch. See Goldman v. Mandell, 403 So. (e.s. Stat., defining a "[t]rustee" and a "[b]eneficiary" for purposes of the act. However, in some situations the homestead exemption goes away or does not apply. (e.s. The statute bases entitlement to the exemption on factual determinations relating to the person seeking the exemption. Zimmerman Kiser Sutcliffe is a Florida Law Firm specializing in Bankruptcy & Creditor’s Rights, Corporate, Estate Planning and Probate, Labor & Employment, Litigation, Real Estate, Tax, and Workers’ Compensation LANDMARK CENTER ONE | 315 East Robinson Street, …  In this regard, section 196.041(2), Florida Statutes, provides: 2d 621 (Fla. 2d DCA 1969) and Waters v. Sundstrom, 386 So. And see Ops. There has been hesitation in the past to put homestead property into a revocable trust because of an unfortunate Florida bankruptcy-court opinion that stood for the proposition that homestead property in a revocable trust was not owned by a “natural person,” thus it lost its creditor protection.  689.071 Florida Land Trust Act. 2d 727 (Fla. 1969); Ferraro v. Parker, 229 So.  In this regard, section 196.041(2), Florida Statutes, provides: "A person who otherwise qualifies by the required residence for the homestead tax exemption provided in s. 196.031 shall be entitled to such exemption where his possessory right in such real property is based upon an instrument granting to him a beneficial interest for his life, such interest being hereby declared to be 'equitable title to real estate,' as that term is employed in s. 6, Art. Based on the terms of section 196.041(2), Florida Statutes, above, the opinion concludes that a trust beneficiary is entitled to a homestead exemption only if the beneficiary holds equitable title to the real estate "for life."  And see Art.  See Title, Ch. Florida courts are extremely reluctant to take this step and will try to sustain the trust whenever possible.. Section 196.041(2), Florida Statutes, specifically provides that VII, s. 6(a), Fla. Const. Check out your county tax department or state tax website for more information, including a homestead exemption application form.  VII, Section 6 of the Florida Constitution. Yes. Whether section 689.071(3), Florida Statutes, confers upon a trustee of a land trust a sufficient possessory interest to support a homestead tax exemption? Section 689.071 was recently amended to reflect that the principal residence of a beneficiary held in a Land Trust qualifies for the Homestead Tax Exemption. "Every person who has the legal or equitable title to real estate and maintains thereon the permanent residence of the owner, or another legally or naturally dependent upon the owner, shall be exempt from taxation thereon, except assessments for special benefits . The trustee of a Land Trust, who also satisfies the residence and other requirements under Florida law. Who qualifies for homestead exemption? 2d 54 (Fla. 2d DCA 1980). The law regarding Florida homestead is set forth in the state constitution as well as various sections of the Florida Statutes. Mr. Loren E. Levy ]" For purposes of the act a "[l]and trust" is defined to be "any express written agreement or arrangement by which a use, confidence, or trust is declared of any land, or of any charge upon land, under which the title to real property, both legal and equitable, is vested in a trustee by a recorded instrument that confers on the trustee the power and authority prescribed in subsection (3). Because homestead exemption laws are complicated, consult a qualified attorney with questions regarding homestead exemptions and living trusts in your state. The question is, does putting your personal residence into a Land Trust prevent you from qualifying for the Homestead Exemption? State law allows Florida homeowners to claim up to a $50,000 Homestead Exemption on their primary residence. (9) SUCCESSOR TRUSTEE. 2d 621 (Fla. 2d DCA 1969). Likewise, property held in a Florida land trust may qualify as a Florida homestead. However, if the beneficiary otherwise qualifies for the homestead exemption in section 196.031, Florida Statutes, by maintaining the required residence and has a possessory right in that property based on an instrument granting him or her a beneficial interest for life in such property, the beneficiary would appear to be entitled to claim a homestead exemption on such property.  See Johnson v. Taggart,92 So. The Court determined that the Welbaums held beneficial title to their residence for homestead purposes and, because they had, in good faith, made it their permanent residence, they were entitled to homestead exemption. Florida Toll Free Numbers: A homestead exemption reduces the taxable value of the property that you use as your permanent residence by an amount up to $50,000. 2d 511 (Fla. 5th DCA 1981). _____________________________________________________________________. Homestead exemption is a constitutional benefit of a $50,000 exemption from the property's assessed value. VII of the State Constitution; and such person shall be entitled to the homestead tax exemption irrespective of whether such interest was created prior or subsequent to the effective date of this act. The principal residence of a beneficiary shall be entitled to the homestead tax exemption even if the homestead is held by a trustee in a land trust, provided the beneficiary qualifies for the homestead exemption under chapter 196. "A person who otherwise qualifies by the required residence for the homestead tax exemption provided in s. 196.031 shall be entitled to such exemption where his possessory right in such real property is based upon an instrument granting to him a beneficial interest for his life, such interest being hereby declared to be 'equitable title to real estate,' as that term is employed in s. 6, Art. 2d 493 (Fla. 4th DCA 2001). Thus, the statute allows a person to claim homestead exemption based on a beneficial interest for life; the Legislature has determined that a "beneficial interest for life" is the equivalent of "equitable title to real estate[.]" X, Section 4(a)-(b) of the Florida Constitution;; restrictions on devise and alienation, Art.X, Section 4(c) of the Florida Constitution; and exemption from taxation per Art. " If you qualify, you can reduce the assessed value of your homestead up to $50,000. You can also easily transfer beneficial interests.  In 2007, the Florida Legislature amended section 689.071, Florida Statutes, "limiting the definition of the term 'land trust' to an arrangement in which title to real property is vested in a trustee by a recorded instrument that confers certain authority as prescribed by state law[. In light of the extensive ownership interests granted to trustees by the 2007 amendments to section 689.071(3), Florida Statutes, you have also asked whether a beneficiary of a Florida Land Trust may possess a sufficient possessory interest to support a homestead tax exemption. If you have set up a Land Trust to own your Florida real estate and you wish to file for the Homestead Exemption, this AG opinion states that the person to whom the right to reside on the property for life to may file for Homestead Exemption provided that they otherwise qualify for … Other Practical Steps for Retaining Homestead Exemption in a Living Trust. Further benefits are available to property owners with disabilities, senior citizens, veterans and active duty military service members, disabled first responders, and properties with specialized uses. 2d 511 (Fla. 5th DCA 1981). Bill McCollum . For example, a homestead owned by an irrevocable trust (depending on the terms of the trust) may or may not qualify for the homestead property tax exemption or creditor protections granted by the Florida Constitution. - Fraud Hotline 1-866-966-7226 Thus, section 689.071(3), Florida Statutes, vests both legal and equitable title and full ownership rights in the trust property in the trustee. Copyright © 2011 State of Florida. This exemption applies to all taxes, including school district taxes. . Who May File. 2d 209 (Fla. 1974), Ops. Question Two - Beneficiaries HOMESTEAD EXEMPTION INFORMATION. For example, you must apply for a homestead exemption by April 1 in Georgia and submit it to the property appraiser by March 1 in Florida. The principal residence of a beneficiary shall be entitled to the homestead tax exemption even if the homestead is held by a trustee in a land trust, provided the beneficiary qualifies for the homestead exemption under chapter 196. If you do not want your e-mail address released in response to a public records request, do not send electronic mail to this entity. 2d 751 (Fla. 1952). A corporation in Florida, a Florida LLC, or irrevocable trust in Florida cannot claim homestead protection. " Chapter 196, Florida Statutes, implementing Article VII, section 6, Florida Constitution, requires that entitlement to a homestead exemption be based on a person's having either "the legal title or beneficial title in equity to real property[.]"  Section 689.071(2)(b), Fla. . To understand how probate affects a Florida homestead property, it helps to be familiarized with Florida’s homestead rules, which are among the most robust in the nation.
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