Wednesday, September 5, 2012

Considering transfering ownership of your home. This is a must read! Protect yourself.

A transfer of  your home (of any kind) may trigger a large tax increase.

The following is a case that affected one of our clients:

The County increased our clients Assessed Value from $381,890 to $1,000,339 in just one year.  He has lived in this home for many years and has a homestead exemption in place.  When he asked us how it was possible, we researched and explained.

He went to see a financial planner who transferred the legal ownership from him and his wife, into a Trust in which his wife was a trustee.  This would result a tremendous income tax savings for their family.

What they did not know, was having this done automatically triggered his property taxes to increase by 161% in one year.  We then told him what should have be done in-order to retain his "Save Our Home" portability.  Also know as a homestead exemption, his property tax assessment would have been capped at the lower of a 3.0% increase or the cost of living increase.

The County may not be aware of one’s intent in changing ownership.  But in doing so, it may automatically trigger a higher tax assessment, unless it is done properly.

If the previous owner retained an equitable/ beneficial title via the Trust, he should submit a copy of the first page and those specific portions of the Trust that express equitable/ beneficial title.  The Trust document is important.  An ownership change may have resulted in the homestead exemption benefit not being eligible for automatic renewal for 2012, as required by Section 196.011(9)(a), Florida Statutes, and Florida Department of Revenue Regulation 12D-7.011.

Once equitable title is confirmed, the homestead exemption benefit will continue for 2012.  We now have another happy client.  But having reduced his Assessment Value  to below $400,000 even though his Market Value is $1,00,339, he will no longer need to appeal his assessment.  This was all done for him at No Charge, once we were aware of his problem.

*Every situation is different, we advise you to consult with property tax appeal group and an attorney.
(305) 693-3500