Tampa, FL - It now seems likely that the Property Tax benefits provided by Amendment 1 will be short lived.  So, if you plan to take advantage, you'd better move quickly!

Much to my chagrin, Florida voters did pass Amendment 1 back in January.  (I was against it as I believed then, and still believe that the passage of Amendment 1 would delay until at least 2011 or 2012 the real Property Tax reform that is needed here in Florida.  So far, that seems to be the case.  The Tax Committee's proposals, if passed in November, will not take effect until 2011, and the Senate still deems it appropriate to stand in the way of the meaningful property tax reform Florida must have to reignite its real estate driven economy.  Nero is fiddling again, but this time it's Florida that is burning.) 

While Amendment 1 did not offer much of anything to 2nd homeowners, investors, and first time home buyers, there was an upside for some lucky folks... It did provide a nice tax break to current Florida Homeowners.  Amendment 1 offers 2 features for these lucky folks...

1) The 'Homestead' exemption was increased from $25,000 to $50,000.  For this most part, the savings offered from this are insignificant.  To determine your savings, simply multiply your millage rate (found on your tax bill or in the tax records) by 25.  Whatever number that calculation yields will be subtracted from your tax bill.  While very strait forward, the benefit will be very insignificant, especially to those struggling families paying $5,000, $10,000, $20,000 or more in property taxes each year.

2) The second break, which has been called 'Portability,' does offer an opportunity for more significant savings for some.  (However, those planning to take advantage of Portability had better act quickly, as it may be going away very soon!)  Portability is a benefit to current home owners that can be significant for those who have been living in their homes for a while, and who have accumulated a differential between the Just Value and Assessed Value of their homes (for tax purposes).  The greater the difference in these two amounts, the greater the benefit to the homeowner.  What it means is, these folks can now apply some (up to $500,000 of home value) of this accumulated Homestead Tax benefit when they sell their current home and purchase another one.  The math can get a little tricky, especially if the new home has a lower purchase price than the selling price of the current home, but for those who have stayed put for many years, there is the potential for outstanding property tax savings.

Here's how home buyers can take advantage of this nice perk... With home prices as low as they are, (especially with all the 'Short Sale' and Foreclosure opportunities on some wonderful homes), there are a plethora of great deals right now.  So, it truly is a great time to buy.  You may be able to get a better home than you are living in right now, for less money than you'd think, and not suffer a significant increase in property taxes.  However, timing could be extremely critical. 

My advice is: DON'T WAIT TOO LONG.  If you do, you might miss out!  As mentioned earlier, it is likely that the courts will overturn Amendment 1 in the near future, after judging it to be unconstitutional.  (Several law suits have already been filed on this, and many legal experts say that the courts will have no choice but to overturn Amendment 1.)  If this happens, the 'Portability' benefit will go away.  However, I have been told that those who have already taken advantage of 'Portability' prior to its future demise will not be penalized after the fact.  Meaning, they will be able to keep their new tax rate.  However, those who wait too long and buy after Portability has been reversed, (if it will be), will buy under the same unequitable, overly burdening Property Tax situation Florida has suffered for several years.

I'll be glad to help you determine your Portability tax benefit.  Please drop me an EMAIL and I'll get back to you with an estimate of what your benefit could be - which will greatly depend upon the price range of the home you think you'd like to purchase.

As Always... We'd like to hear from you.  Please feel free to add your comments!