Clients often ask me if they can have two homesteads. They’ll explain that only one of them has become a Florida resident. The other is still a resident of Michigan, and Michigan has a Principle Residency exemption for its residents which saves them property taxes on their Michigan home.
First of all, let’s review what is required to qualify for homestead status in Florida.
(1) You must own the property (or your revocable trust must own it). You cannot be a tenant or it cannot be owned by a corporation, LLC or certain irrevocable trusts.
(2) You must be a resident of Florida.
(3) It must be your primary residence. This means you, your spouse, or family members who you are legally obligated to support must reside in the home.
And all of these qualifications must be existing on January 1 of every year you are seeking to claim the exemption. Therefore, activities such as renting out your home, not changing your drivers license or car registration or voting registration to Florida can jeopardize your homestead status.
Likewise, if you maintain an out-of-state-residency-based tax exemption, reduction, benefit or credit on another property you own, you also jeopardize your homestead status in Florida. So, in the example at the beginning of this article, the answer is NO, you cannot have two homesteads, except in a very limited scenario.
A Pasco County case did provide a circumstance where a husband and wife can each claim Florida homestead. The Court ruled that where the husband and wife have established two separate permanent residences in good faith and have no financial connection with and do not provide benefits, income, or support to each other, each may be granted a homestead exemption if they otherwise qualify. This means that the husband and wife have separate and distinct households, similar to a marriage separation.
The Court made it clear that the burden of proving this exception would be on the taxpayers.
Florida law also has some severe penalties for those improperly claiming a homestead exemption. A tax lien will be placed against the homestead property. The homeowners will be liable to pay back all of the tax savings they realized during the previous years that the homestead was wrongly claimed, up to ten years. This includes the tax savings due to the $25,000 and $50,000 taxable value reduction as well as the savings resulting from the 3% cap granted by the Save Our Homes amendment. They also will be required to pay a penalty of 50% of the unpaid taxes for each year. And all of this accrues interest at a rate of 15% per year.
The takeaway of this article. Be careful in claiming your Florida homestead exemption. If you are unsure, consult a Florida attorney experienced in such matters.