1. Three-In-One.  Florida homestead has special status in three different contexts: (1) ad valorem (property) taxation, (2) creditor exemption, and (3) rules of descent.  In most cases, property that qualifies as homestead in one context qualifies in the other two, but not always.

2. Taxing Questions.  Florida homestead is entitled to a $25,000 property tax exemption.  Homestead property is also subject to the “Save Our Homes” cap, which limits increases in the appraised (taxable) value of homestead property to not more than 3% annually.  In some cases, the “Save Our Homes” accumulated tax savings is portable to a newly purchased homestead.

3. The Castle Moat.  The Florida Constitution provides that, in many cases, Florida homestead is exempt from the claims of the owner’s creditors.  During the owner’s lifetime, unsecured creditors cannot force the sale of homestead property to generate funds for the payment of the owner’s debts.  When the owner dies, the owner’s spouse and heirs are entitled to homestead property free of the owner’s unsecured debts.

4. No Freedom in Death.  If the owner of Florida homestead is survived by a spouse and at least one minor child, the spouse gets a life estate in the homestead, and the owner’s heirs get the reminder interest.  The owner’s Last Will does not matter.  If not survived by a minor child, the owner’s homestead may be devised to the surviving spouse.  In any case, homestead owned by spouses, as tenants by the entireties, goes to the surviving spouse.

5. Just the Facts.  Florida property is the owner’s homestead only if the owner intends for it to be his or her primary residence.  For legal purposes, the owner’s intention is determined based on the facts, which may include place of employment, enrollment of children in school, registration to vote, and driver’s license address.

6. City House or Country House.  The Florida Constitution’s creditor exemption is limited based on where the homestead is located.  If it is within city limits, the exemption only applies to one-half acre.  Outside city limits, the exemption applies to 160 acres.  Forced sale may be possible for larger parcels, but the exemption is allocated pro rata.  Only the residence is exempt, not other buildings.

7. The Homestead in Probate.  If Florida homestead passes to a surviving spouse and/or heirs upon the owner’s death, then it is not necessarily subject to a probate administration.  However, the personal representative (executor) can safeguard the homestead if need be.  If the homestead passes to anyone else, it is part of the probate estate, meaning that probate administration is needed to transfer ownership.

8. Untrustworthy Circumstances.  When a Florida homestead is deeded in the name of the owner’s living trust, it should qualify for the property tax exemption, it will be subject to the restrictive rules of decent regardless of the trust terms, and it may or may not be protected from the owner’s creditors.  It’s usually best to not put homestead in the trust.

9. Some Creditors Are More Equal Than Others.  The Florida Constitution’s creditor exemption does not shield the homestead from the payment of taxes and assessments on the property or obligations in connection with the purchase, improvement, or repair of the property, including mortgages on the property.  Also, the exemption is not available to shield against federal tax liens.

10. Two in the Bush.  It is possible, although rare, for a family to have two qualified homesteads.  This is generally only the case when legitimate circumstances (such as employment) require married spouses to maintain two households.  However, it is presumed that each family unit should only have one homestead, and the burden is on the owners to prove otherwise.