How You Can Calculate Property Tax When Buying A Home

Posted by Florida Realty Marketplace on Tuesday, November 24th, 2020 at 8:00am

How You Can Calculate Property Tax When Buying A HomeOne of the most confusing aspects of purchasing one of the many New Homes For Sale In Winter Garden FL is calculating the property taxes associated with the home. Property taxes can make or break a home purchase and should be considered like any other aspect of a particular house. While it is always recommended to consult a certified tax professional, there are some things you should know going into the process that can help you along the way.

Some Florida Tax Considerations

Florida's .98% average property tax rate comes in slightly lower than the national average of 1.08% meaning that many areas in the state are favorable for homeowners. Florida also has some laws in place to limit the impact of rising property tax rates. Save Our Homes for example is an assessment cap limiting the amount of annual rate increase to no more than 3%.

How Do They Work?

An appraisal, which is an assessment of the value of a property, is done annually to provide an assessed value for each property. This appraisal is done by the county’s property appraiser, an elected official in charge of providing the assessments. Often these appraisals are done systematically or through a mass appraisal allowing several properties to be assessed through market data all at the same time.

Property taxes are then applied to the assessed value which takes the appraisal and takes into account any exemptions, credits, or caps like the Save Our Homes limitation.

One of the most popular tax exemptions is the Homestead exemption which you can claim on owner occupied residential property. Among other benefits like property protection in the event of a homeowner spouse death, the Homestead exemption frees the first $25,000 of assessed value from taxation and an additional $25,000 of value from non-school property taxes.

The benefits of these two programs alone limit the increase in your yearly property tax rates and exclude $25,000 of assessed value for school taxes and $50,000 for all other types of property taxes.

Florida Tax Rates

Property taxes in Florida are implemented in millage rates. A millage rate is one tenth of a percent, which equates to $1 in taxes for every $1,000 in home value. A number of different authorities, including counties, municipalities, school boards and special districts, can levy these taxes.

It's a good idea for homeowners to review their annual Truth in Millage (TRIM) notice, which declares their home’s appraised and assessed value. If the appraised value is too high (higher than what you could get for selling your home), you can file an appeal to the county adjustment board. It’s important to act quickly, though, as you have only 25 days to file an appeal.

Tax Rates Information For Some Of Florida’s Most Popular Counties

  • Brevard County - 0.90% average tax rate - $1,460 median household tax bill
  • Broward County - 1.12% average tax rate - $2,503 median household tax bill
  • Duval County - 0.90% average tax rate - $1,460 median household tax bill
  • Hillsborough County - 1.02% average tax rate - $1,836 median household tax bill
  • Lee County - 0.97% average tax rate - $1,853 median household tax bill
  • Miami-Dade County - 1.04% average tax rate - $2,523 median household tax bill
  • Orange County - 1.01% average tax rate - $1,949 median household tax bill
  • Palm Beach County - 1.12% average tax rate - $2,712 median household tax bill
  • Pinellas County - 0.94% average tax rate - $1,566 median household tax bill

Property taxes can be confusing and unique to everyone depending on the expectations and credits available to them. But don't let the process discourage you. Taking some time to understand the basics and how they affect you and your home purchase can help you make a more informed decision.

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