On January 29^th, 2008 the Citizens of Florida passed Amendment 1, a Tax Reform Package, as an amendment to the State Constitution. Click here for information related to Amendment 1.

Effective January 1, 1995, Amendment 10 to the Florida Constitution limits any annual increase in the assessed value of residential property with a homestead exemption to 3% or the amount of the Consumer Price Index (CPI), whichever is less.

Buyers should not rely on the amount of property taxes paid by the previous owner because the tax year following the sale the Homestead Exemption and Amendment 10 Cap are removed, and the property is reassessed to equal the current market value.

The first year an owner applies and qualifies for homestead exemption is the base year. The assessed value equals the market value. The year following the base year is when the assessed value is capped.

****EXAMPLE: If you purchased your property in 2004 you may have inherited the previous owner's Homestead Exemption and Amendment 10 Cap. By state law, this exemption and cap will be removed in 2005 and you must file for your own homestead exemption for 2005.****

Some property improvements may trigger reassessment of the property that could result in higher property taxes.

Example: A pool was added to a property with a homestead exemption in 2004. In 2005, the assessed value will not increase more than 3%, plus the value of the pool.

Other Points:

• The cap applies only to property value, not to property taxes.
• Non-homestead exempt properties are not eligible for the cap.
• The assessed value can increase by the amount of the assessment cap (3%) even if the market value decreases.
• The assessed value cannot exceed the market value.