Florida homeowner tax bill

[RivShore]

But, for how long? To me, that would argue in favor of something like a tax rebate over making a change to the state’s constitution to prohibit one particular form of taxation.

I think they did not go the rebate route because Florida has no income tax and therefore no easy way to collect the info needed for stuff like means tests. But I agree, that would be much better.

 

[ILoveMyDVC]

How do I expect the gap to be closed? Thankfully, I'm not in politics, so I have no idea. But as far as I know, no bills to increase non-homestead apprasial value ratios have been introduced.

Even if they did increase non-homestead property taxes, I can see how timeshare owners and second-home owners would be upset (and I am a DVC owner), but I don't necessarily think it would be unfair. Hawaii is not shy about charging multiple taxes to tourists that residents don't pay, so why not Florida?

Montana levied a big tax on non-resident properties.

 

[J-Dog]

Montana levied a big tax on non-resident properties.

Yeah. That would be a big revenue boost in FL for sure.

And HI adds TOT taxes, non-kamaina fees at tourist locations, and now I think that they have actually implemented the $25 fee for tourists just to land in the state.

There are certainly ways to make that money up.

 

[muppets3d]

Yeah. That would be a big revenue boost in FL for sure.

And HI adds TOT taxes, non-kamaina fees at tourist locations, and now I think that they have actually implemented the $25 fee for tourists just to land in the state.

There are certainly ways to make that money up.

The challenge with governments and tourism attractions is to make sure they are not placing an undue burden on tourists, because they can and will go someplace else - this is a hard lesson that Las Vegas is learning as we speak for example.

 

[J-Dog]

The challenge with governments and tourism attractions is to make sure they are not placing an undue burden on tourists, because they can and will go someplace else - this is a hard lesson that Las Vegas is learning as we speak for example.

That's not quite apple to apples, because Vegas' issues have to do with ridiculous price gouging and hidden fees by the private casino corporations, not government taxes. But in essence I agree that they can't go crazy with it. Although that hasn't stopped Hawaii recently - they seem to have no issues with consistently adding new tourism fees.

 

[muppets3d]

That's not quite apple to apples, because Vegas' issues have to do with ridiculous price gouging and hidden fees by the private casino corporations, not government taxes. But in essence I agree that they can't go crazy with it. Although that hasn't stopped Hawaii recently - they seem to have no issues with consistently adding new tourism fees.

It's all a burden on the tourist so it has the same effect, but I do agree it's not the governments fault in the case of Vegas. Eventually the Hawaiian government may learn that planes can just as easily keep flying across the Pacific versus land on their islands as well.

 

[zackiedawg]

Not to divert this thread into tax policy (but some of us do somehow enjoy doing that ) but I think the only fair way to tax a home if it is based on original purchase price plus any major improvements, completely ignoring market price. This would mean that the person who has been in their house for decades and now has no kids in school would pay the least, while the newcomers, probably younger with school age kids, would pay the most.

Florida too already has a similar system, though the homesteaded property tax can and does increase - it has a cap. Your initial home's assessment is based on market value at time of purchase, which should be pretty close to purchase price. Each year, properties are reassessed, however the Save Our Homes clause caps the amount that can be increased to 3% per year for existing homeowners. In any given year, brand new neighbors in the same house can end up having a massively higher property tax as their neighbor who's been there 10 years.

My parents' house which was purchased for $400K in the late 70s and their property taxes in 2023 were up to $7800. When they passed, I moved into their house (I've already been living in S Florida since 1994) - which was then reassessed as a new owner, and my property tax jumped to $15K. There was clearly a big savings for having owned their home so long, with the 3% cap on tax increases over the years.

Whatever the politics, I would not have any complaints if my property taxes either went away, or got significantly lower. Between insurance and property taxes, it's mighty expensive living in S Florida. It has its perks, so I'm not planning to move anytime soon, and having a paid-off home and profits from my previous home, things still work out well - I consider my insurance and property tax bill to be my 'mortgage' since I don't have a mortgage - I'm still putting out $2300 mo for insurance and property tax, so it feels like a rent or mortgage.

 

[VGCgroupie]

It's all a burden on the tourist so it has the same effect, but I do agree it's not the governments fault in the case of Vegas. Eventually the Hawaiian government may learn that planes can just as easily keep flying across the Pacific versus land on their islands as well.

We stopped going to Vegas not because of prices but because they couldn’t keep it clean/safe.

 

[muppets3d]

We stopped going to Vegas not because of prices but because they couldn’t keep it clean/safe.

Another example of how government can push tourists away. Same lesson Atlantic City had to learn.

 

[supersnoop]

Not to divert this thread into tax policy (but some of us do somehow enjoy doing that ) but I think the only fair way to tax a home if it is based on original purchase price plus any major improvements, completely ignoring market price. This would mean that the person who has been in their house for decades and now has no kids in school would pay the least, while the newcomers, probably younger with school age kids, would pay the most. It would incentive homeowners to put real roots into the community and move the burden to people who can better afford it.
Perfect example of this is some beach towns in NJ, 60 years ago, average blue collar workers bought tiny cape houses across the street from the ocean, for (no exaggeration) $5-20k. Today that home is worth $2M+, how can that retired blue collar couple ever be expected to keep up with the taxes on those gains?
These homestead exemption increases seem to be moving toward my ideal but someone has to explain what happens to the revenue holes it creates for towns and counties (who I'm sure will spend more on ads fighting this than the revenue they will lose ).

I fear this position is based on a misunderstanding of how tax rates are calculated. At least here, where I'm in charge of it, we're restricted to growth in overall collections. When you hear about a "3.5% tax increase," that doesn't mean that everyone's bill is going up 3.5%, but that the taxing entity is collecting that much more than last year.

If everyone's home doubled in value, the tax rate would be cut in half so that the bill to each individual homeowner would be the same. While that blue-collar worker's home has increased dramatically, it seems likely that everyone in that town has seen the same appreciation. Their actual tax bill should be growing only by the growth in expenditures, which should closely match inflation.

The value-based approach is genuinely a "fair share" calculation. Should someone who purchased a home 40 years ago really be paying one-tenth or less than someone who purchases the same house next door? We've seen terrible affordability issues with this type of policy; homes dramatically increase in cost due to a decrease in supply when people refuse to sell. We see a massive disproportionate share of taxes on newcomers as the cost to provide services increases, but the base value doesn't grow, resulting in obscene tax rates.

To bring this back on topic, and to reinforce my initial calculation; if Florida exempts those with homestead exemptions from paying property taxes, that doesn't change the amount cities, counties, and school districts spend. instead, it shifts the burden onto the commercial property. If you take half the property value off the rolls, then the tax rate doubles on everyone else in order to collect the same amount of money. In areas with a larger proportion of commercial property, that may not be a big impact, but in areas that are mostly "bedroom communities," those with more houses than shops, it will destroy the business community.

 

[RivShore]

Each year, properties are reassessed, however the Save Our Homes clause caps the amount that can be increased to 3% per year for existing homeowners.

I had forgotten about the cap in Florida, that really does make the policy close to what I was thinking.

As relatively recent homeowners here, that really hasn't helped us yet. And the homestead exemption is also a drop in the bucket when paying the post-covid housing prices of central Florida. I guess I will feel better about in in 20 years or so...lol

I'm still putting out $2300 mo for insurance and property tax, so it feels like a rent or mortgage.

Wow, that was our full mortgage payment (including P&I, tax and insurance) 6 years ago on our northeast home, those were the days!

 

[VGCgroupie]

I fear this position is based on a misunderstanding of how tax rates are calculated. At least here, where I'm in charge of it, we're restricted to growth in overall collections. When you hear about a "3.5% tax increase," that doesn't mean that everyone's bill is going up 3.5%, but that the taxing entity is collecting that much more than last year.

If everyone's home doubled in value, the tax rate would be cut in half so that the bill to each individual homeowner would be the same. While that blue-collar worker's home has increased dramatically, it seems likely that everyone in that town has seen the same appreciation. Their actual tax bill should be growing only by the growth in expenditures, which should closely match inflation.

The value-based approach is genuinely a "fair share" calculation. Should someone who purchased a home 40 years ago really be paying one-tenth or less than someone who purchases the same house next door? We've seen terrible affordability issues with this type of policy; homes dramatically increase in cost due to a decrease in supply when people refuse to sell. We see a massive disproportionate share of taxes on newcomers as the cost to provide services increases, but the base value doesn't grow, resulting in obscene tax rates.

To bring this back on topic, and to reinforce my initial calculation; if Florida exempts those with homestead exemptions from paying property taxes, that doesn't change the amount cities, counties, and school districts spend. instead, it shifts the burden onto the commercial property. If you take half the property value off the rolls, then the tax rate doubles on everyone else in order to collect the same amount of money. In areas with a larger proportion of commercial property, that may not be a big impact, but in areas that are mostly "bedroom communities," those with more houses than shops, it will destroy the business community.

15K is very high. What is the property tax rate there?

 

[RivShore]

If everyone's home doubled in value, the tax rate would be cut in half so that the bill to each individual homeowner would be the same.

I understand how it works. Reassessments can also cause problems were one side of town increases in value, while another stays the same, that will lead to more inequities. If all towns moved to a value locked in at purchase price, you would eliminate that issue too.

Should someone who purchased a home 40 years ago really be paying one-tenth or less than someone who purchases the same house next door?

I would argue yes, because, under the most common scenario, the new comers probably have kids in school, which is the most costly municipal service, while on the other hand, those 40 year owners burden on the town has probably gone down significantly as they no longer have kids in school, probably don't drive as often, don't have as much garbage, etc etc.

if Florida exempts those with homestead exemptions from paying property taxes, that doesn't change the amount cities, counties, and school districts spend. instead, it shifts the burden onto the commercial property.

Even though I live in Florida, I have not looked closely at the proposals because I never expect it to happen! But I think the one that is moving forward would slowly phase in the elimination of non-school property taxes. Schools being the biggest piece of the pie, means taxes would only go down marginally. And I have yet to see how they make up for that lost revenue. Still so many questions...

 

[muppets3d]

I understand how it works. Reassessments can also cause problems were one side of town increases in value, while another stays the same, that will lead to more inequities. If all towns moved to a value locked in at purchase price, you would eliminate that issue too.


I would argue yes, because, under the most common scenario, the new comers probably have kids in school, which is the most costly municipal service, while on the other hand, those 40 year owners burden on the town has probably gone down significantly as they no longer have kids in school, probably don't drive as often, don't have as much garbage, etc etc.


Even though I live in Florida, I have not looked closely at the proposals because I never expect it to happen! But I think the one that is moving forward would slowly phase in the elimination of non-school property taxes. Schools being the biggest piece of the pie, means taxes would only go down marginally. And I have yet to see how they make up for that lost revenue. Still so many questions...

Public schools, garbage collection, etc., are not typically billed based upon consumption like water or electricity.

Businesses pay property tax bills for their commercial property and as we know a large portion of property taxes go towards public education, but obviously a business cannot have children.

If we want to completely revamp the way these services are paid for, I think a lot of people would be all ears. And maybe that's what Florida is trying to do. We'll see.

 

[zackiedawg]

15K is very high. What is the property tax rate there?

I'm not sure exactly what it is in the Orlando area, but down here in South Florida, in particular for Boca Raton, FL, it's a bit over $17 per $1000. There's a homestead exemption of $25K, and the cap of 3% for existing homeowner's reassessments. So the tax rate is pretty high, but also the home values are through the roof - so for new buyers at least, in my town 3400 square foot single-family homes generally run about $1M to $1.4M in incorporated areas, higher if waterfront, golf-course-fronted, and beach/intercoastal double that.

 

[VGCgroupie]

I'm not sure exactly what it is in the Orlando area, but down here in South Florida, in particular for Boca Raton, FL, it's a bit over $17 per $1000. There's a homestead exemption of $25K, and the cap of 3% for existing homeowner's reassessments. So the tax rate is pretty high, but also the home values are through the roof - so for new buyers at least, in my town 3400 square foot single-family homes generally run about $1M to $1.4M in incorporated areas, higher if waterfront, golf-course-fronted, and beach/intercoastal double that.

Wow. Where I live we are about $6 per $1000.

 

[RivShore]

Wow. Where I live we are about $6 per $1000.

And wow again, we are at $15 per $1000 in Lake County.

 

[RivShore]

I guess we can see why the legislature is trying to do something...anything...