Tax portability deadline coming up
Published: Saturday, March 1, 2008 at 6:01 a.m.
Last Modified: Friday, February 29, 2008 at 9:14 p.m.
DuPont Murphey, a retired appliance salesman, paid $200 more in property taxes last year despite having moved into a smaller home that was $100,000 cheaper than his old house.
Save Our Homes
- How to calculate Save Our Homes portability:
- If upsizing, the full amount of the previous Save Our Homes accrued savings is transferrable up to $500,000.
- If downsizing, take your 2007 Save Our Homes value divided by the market value of your old house. Multiply that fraction by the market value of your new house. ("SOH" / "old market value") X "new market value" = "new SOH tax break"
However, Murphey can expect a big tax break in 2008.
He is among a large number of Floridans who will benefit from the retroactive amendment passed on Jan. 29 that allows Save Our Homes property tax savings to transfer to a new household if it was purchased after January 2007.
Monday is the last day to apply for this new "portability" with the Alachua County Property Appraiser's Office, 2 SE 1st St.
Save Our Homes was enacted in 1992 in response to booming property values in South Florida.
It caps assessed value increases at 3 percent a year for houses that are primary places of residence.
In the five years Murphey lived in his house in the Town of Tioga, he accrued almost $63,000 in untaxable appraised value because of the cap - a savings he lost when he sold the house.
The amendment passed in January made the accrued value or a percentage of that value "portable."
County Appraiser Ed Crapo said that 554 people had applied to transfer their Save Our Homes as of Tuesday.
There were no estimates available of what the value of those transfers will be, but Murphey will save more than $1,000 with his transfer assuming the millage rate stays the same.
This year portability served as a nice surprise to those who had already decided to purchase a new home, but real estate agents hope that in future years portability will motivate home buyers.
"It's a deterrent," Realtor Tasya Williamson said of Save Our Homes. "I've lost a couple of sales in the last four years over that issue - people who said they didn't want to move because their taxes would go up."
Williamson, who sold Murphey his new house in Garrison Way, called to remind him of the portability deadline.
"I think people pretty much generally know that it's there," Crapo said, adding that many people misunderstand how it works. "People think that if they sell their property this year . . . and they buy another one, that they can take it with them that year."
In reality, home buyers will have to pay property taxes without the Save Our Homes benefit for a year before it is transferred.
Crapo said their call load has increased since the new amendment was passed, although not as much as expected.
The million-dollar question, however, has been about a lawsuit filed challenging the portability amendment as a law that unjustly favors long-term homeowners over first-time home buyers.
"People call and ask us what the courts could do and of course we don't know," Crapo said. "The court could decide it was unconstitutional and then roll it back and make it retroactive."
Because there is no knowing what the court will do, Crapo said, there is a risk factor associated with buying a new home and possibly losing years of accrued Save Our Homes tax breaks.
Megan Rolland can be reached at 338-3104 or firstname.lastname@example.org.
Reader comments posted to this article may be published in our print edition. All rights reserved. This copyrighted material may not be re-published without permission. Links are encouraged.
Comments are currently unavailable on this article