A new tax reform proposal in Florida is causing heated debate. The proposed bill, sponsored by state House Rep. Ryan Chamberlin, seeks to study whether the Sunshine State can eliminate property taxes.
Data show that property taxes have been rising across the country. Over the last few years, the average tax on a single-family home in the U.S. was just under $4,000. State and local taxes continue to be among the highest tax bills people pay in the U.S. But, as in many states, property taxes in Florida are a primary source of funding for essential local government services and infrastructure.
In a message on X, formerly Twitter, Chamberlin wrote about the tax proposal: "It's Time - there's a better way. No more property taxes!”
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Since Florida is a state without an income tax, eliminating property taxes would require alternative sources of revenue. That revenue would likely come from increased sales taxes. So, the proposal has generated some controversy.
Here’s what else you need to know.
Florida sales tax increase?
The bill, which essentially advocates for eliminating property taxes and replacing them with an expanded sales tax, passed its first committee vote in the Florida House. What will happen in the legislature going forward remains to be seen.
- A main concern with the proposal is that it could lead to a considerable increase in sales taxes in Florida.
- Opponents argue that shifting to higher taxes on goods and services could disproportionately affect certain consumers, particularly those with lower and middle incomes or who do not own property.
According to local reporting, some supporters believe abolishing Florida's property taxes could help promote affordable housing and increase property ownership. They contend that doing away with property tax would alleviate the financial burden on property owners and renters.
How much is Florida property tax?
Property taxes in Florida are determined by several factors, such as the county and city where the property is located and its assessed value. Due to the absence of a state income tax, Florida's property tax rates are generally considered moderate compared to other states.
- On average, property owners in Florida can expect to pay between about 0.8% and 2.0% of their property's assessed value annually in property taxes.
- Actual property tax bills vary widely depending on the location and assessed value of the home.
- Under Save Our Homes (SOH), a property tax cap amendment to Florida's constitution, homestead property assessments can’t increase more than 3% from the previous assessment period. (The cap for non-homestead properties is 10%.)
Meanwhile, as Kiplinger has reported, Florida's current average sales tax rate of 7.02% is relatively moderate compared to other states. However, a $1.3 billion Florida tax relief bill signed by Gov. Ron DeSantis last year extended many of Florida’s numerous sales tax holidays. A new Florida sales tax holiday, which took place in January of this year, was added. Fiscal concerns make it unclear whether the extended tax holidays will continue.
Tax in Florida: What happens next?
The topic of taxes, revenue, and economic policy is complicated in many states, not just Florida. If the study is approved by the legislature, it could provide information by next year, 2025, to guide Florida property tax reform. In the meantime, Floridians face other challenges with property, including skyrocketing home insurance costs and major insurers like AAA and Farmers restricting or withdrawing coverage in the state.
It's also important to note that although some states have considered getting rid of property taxes (a similar proposal, AxMiTax, is circulating in Michigan, where homeowners face the highest property tax increase in 28 years, at 5%), no state has done so.
Related
- Where Inflation is Causing Property Taxes to Increase the Most
- Property Tax Cap: Does Your State Have One?
- Who Benefits From the Supreme Court Home Equity Theft Ruling?
- AAA Joins List of Insurers Restricting Coverage in Florida
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FAQs
The bill, which essentially advocates for eliminating property taxes and replacing them with an expanded sales tax, passed its first committee vote in the Florida House. What will happen in the legislature going forward remains to be seen.
At what age do you stop paying property tax in Florida? ›
Senior Exemption Information
The property must qualify for a homestead exemption. At least one homeowner must be 65 years old as of January 1. Total 'Household Adjusted Gross Income' for everyone who lives on the property cannot exceed statutory limits.
What city in Florida has the highest property taxes? ›
Counties with the highest property taxes in Florida include Miami-Dade, Palm Beach, and Broward.
- Miami-Dade County has a median annual property tax payment of $2,756.
- Palm Beach County has a median payment of $3,956.
- Broward County has a median payment of $3,343.
Property to the value of $5,000 of every widow, widower, blind person, or totally and permanently disabled person who is a bona fide resident of this state is exempt from taxation. See Form DR-501. (see section 196.202, F.S.)
Is anyone exempt from paying property taxes in Florida? ›
Real estate owned by certain religious, charitable or educational entities that are used for religious, charitable or educational purposes is exempt from property taxation. An exemption must be applied for through the Property Appraiser's office. The exemption is not automatic.
What state has the highest property tax? ›
Key takeaways on state property taxes in the US
New Jersey has the highest property tax rate at 2.47%, followed by Illinois, Connecticut, New Hampshire, and Vermont. There are 14 counties with an estimated median property tax above $10,000 across California, New York, New Jersey and Virginia.
Does Florida offer a senior discount on property taxes? ›
Certain property tax benefits are available to persons 65 or older in Florida. Eligibility for property tax exemptions depends on certain requirements. Information is available from the property appraiser's office in the county where the applicant owns a homestead or other property.
How can I reduce my property taxes in Florida? ›
When someone owns property and makes it his or her permanent residence or the permanent residence of his or her dependent, the property owner may be eligible to receive a homestead exemption that would decrease the property's taxable value by as much as $50,000.
Can you write off property taxes in Florida? ›
State and local property taxes are deductible in Florida, regardless of whether they're paid through an escrow account as part of your mortgage payment (this is how most Florida homeowners pay real estate taxes), or paid directly to the taxing authority.
Where is the cheapest property tax in Florida? ›
Dixie County is located in the northwestern section of the state. Dixie County has the lowest median property tax which is $503. It looks like the counties in Florida with the lowest median property tax fall within the northwestern and north central part of the state, with most of them being in the Panhandle.
Most Affordable Places to Live in Florida in 2024
- Bartow.
- Cape Coral.
- Dade City.
- Dunedin.
- Gainesville.
- Jacksonville.
- Kissimmee.
- Melbourne.
Florida Property Taxes
The state's average effective property tax rate is 0.80%, which is lower than the U.S. average (0.99%). The typical homeowner in Florida pays $2,338 annually in property taxes, although that amount varies greatly between counties.
Do you pay property tax in Florida if you are 100% disabled? ›
Veterans with Service-Connected, Total and Permanent Disability or Confined to a Wheelchair Property Tax Exemption: Veterans who have a service-connected, total and permanent disability rating from the VA, or who are confined to a wheelchair are eligible for a total property tax exemption on their homesteads.
Do widows get a tax break in Florida? ›
The widow/widowers exemption reduces the assessed value of your property by $5,000. This provides a tax savings of approximately $100 annually. Any widow/widower who owns property and is a permanent Florida resident may file for this exemption.
What is the $25,000 exemption in Florida? ›
The $25,000 TPP exemption
The waiver applies in all subsequent years that the value of the property stays at or below $25,000. By February 1st of each year, the property appraiser will notify TPP owners whose requirement for filing an annual return was waived in the previous year.
What is the Florida tax bill 2024? ›
The bill: Adopts the Internal Revenue Code as it existed on January 1, 2024. Creates a time-limited tax credit for corporations who employ persons with unique abilities. Makes administrative changes to the credit provided for certain expenditures made by operators of short line railroads.
Will home prices drop in 2024 in Florida? ›
According to Zillow, home price appreciation is expected to slow down significantly in the coming years, with a predicted increase of only 3.4% for 2024. This could provide relief to buyers who have been priced out of the market in recent times.
Is Florida real estate dropping? ›
The Ramsey Solutions research shows that housing prices in Florida have gone up, especially when comparing the fourth quarters of 2022 and 2023, respectively. At the end of 2022, the median sales price of a Florida home was $401,990.
What is the property tax discount in Florida? ›
When someone owns property and makes it his or her permanent residence or the permanent residence of his or her dependent, the property owner may be eligible to receive a homestead exemption that would decrease the property's taxable value by as much as $50,000.
