What in the heck in homesteading? It sounds like something that happened in the wild wild west. Homesteading is a tax benefit offered to Florida residents.
If you have purchased a primary residence you actually receive two tax benefits……don’t tell Uncle Sam! The first benefit is in the form of an exemption for the first $50,000 of value for property tax purposes. Therefore, if you purchased a home for $300,000, you will be taxed on $250,000. I know, awesome!
The second benefit is the “Save Our Homes” cap on annual assessments. The cap is set at the lower of 3% or the change in the consumer price index (CPI). Confused? Here is an example: In 2013 the CPI was only 1.7%, therefore property taxes could not increase by more than 1.7%, if they increased at all! In 2008 the CPI was 4.1%, but the increase of the assessed value was capped at 3%.
For additional information go to the Florida Department of Revenue website at Floridarevenue.com.