If you're buying or selling a home in Tampa Bay, you've probably heard the terms "homestead exemption" and "Save Our Homes" thrown around, and they're often confused for the same thing. They're not. Here's the straight explanation, no jargon.
The Short Version
- Homestead Exemption is a discount on your property tax bill for your primary residence. It does not transfer when you sell. The new owner must file their own.
- Save Our Homes (SOH) is a separate benefit that caps how much your assessed value can rise each year (3% or the Consumer Price Index, whichever is lower). This is where the real long-term savings live.
- When you sell and buy another Florida homestead, you can carry, or "port", your accumulated SOH savings to the new home. Up to $500,000.
What Is the Homestead Exemption?
Florida homeowners who use a property as their permanent residence can apply for a Homestead Exemption, which reduces the taxable value of that home by up to roughly $50,000. It has to be filed with your county Property Appraiser, and you have to qualify as of January 1 of the tax year.
Important: the exemption does not pass to a new owner. If you buy a home that had a homestead exemption under the previous owner, you still have to file your own application.
What Is Save Our Homes?
Save Our Homes is a constitutional amendment Florida voters approved in 1992. Once a home has a homestead exemption, its assessed value cannot increase by more than 3% per year, or the change in the Consumer Price Index, whichever is lower, no matter how much the market value rises.
Over years of ownership, this can create a large gap between a home's market value and its (much lower) assessed value. That gap is your Save Our Homes benefit.
Good to know: even if your home's market value stays flat, your assessed value can still rise by that same 3%/CPI cap. This is called the recapture rule and it catches people off guard on years when they expected a flat tax bill.
What Happens When You Sell
The Save Our Homes cap resets the year after the sale. The new owner's assessed value moves to full market value, minus whatever exemption they qualify for. This can mean a noticeably higher tax bill for the buyer than what the seller was paying, especially on homes owned 10+ years. Buyers should budget for this, not assume the seller's tax bill carries over.
What Happens When You Buy Another Florida Home: Portability
This is the part most people don't know about. If you had a homestead exemption on your previous Florida home, you can transfer, or "port", your accumulated Save Our Homes savings to your next Florida homestead.
- Upsizing (new home's market value is equal to or higher than the old one): the full SOH benefit transfers, up to a cap of $500,000.
- Downsizing (new home's market value is lower): only a percentage of the benefit transfers. The formula is (new home value ÷ old home value) = percentage ported.
Portability Example
You sell a home with a $300,000 market value for a new home valued at $180,000. That's 180,000 ÷ 300,000 = 60% of your SOH benefit transfers to the new home.
Deadlines to Know
- 3-year window: you must establish your new Florida homestead within 3 tax years of abandoning the old one.
- March 1 filing deadline: you must file Form DR-501 (Homestead Exemption) and Form DR-501T (Portability Transfer) with your new county's Property Appraiser by March 1 of the year you want the benefit applied.
- Late filing is possible in some cases through mid-September, but it is not guaranteed and can cost you a full year of savings if missed.
How to File
- Close on the sale of your current homesteaded property.
- Close on your new Florida home.
- File Form DR-501 (homestead exemption application) with your new county's Property Appraiser.
- File Form DR-501T (Transfer of Homestead Assessment Difference) at the same time.
- Submit both by March 1 of the applicable tax year.
- Keep your prior year's tax bill handy in case the county needs the old assessed value for reference.
County Property Appraiser Links
- Hillsborough County Property Appraiser (Tampa, Brandon, Valrico, Riverview, Plant City)
- Pinellas County Property Appraiser (St. Petersburg, Clearwater, Largo)
- Pasco County Property Appraiser (Wesley Chapel, Land O' Lakes, Trinity)
- Manatee County Property Appraiser (Bradenton, Lakewood Ranch)
- Polk County Property Appraiser (Lakeland, Winter Haven)
- Sarasota County Property Appraiser (Sarasota, Venice)