How Real Property Taxes Are Calculated in Florida

Real Estate Taxes in Florida and How They Are Calculated

Palm Beach County and the Treasure Coast

Property taxes throughout Florida – and Palm Beach county and the Treasure Coast are based on millage rates which are used to calculate your ad valorem taxes. One mil equals $1 for every $1,000 of taxable property value (which is after exemptions if applicable).

The millage rate for Boca Raton is 18.307 per $1,000 of value, so you are paying $18.31 for every $1,000 in taxable value. The county rate is generally 17.7544, so Boca’s rate is slightly higher.

Port St Lucie Millage rate is 22.3637 for 2024.

Florida Homestead Exemptions

In the State of Florida , the $25,000 homestead exemption is applied to the first $50,000 of the property’s assessed value if your property is your permanent residence and you owned it on January 1st of the tax year. This exemption applies to all taxes, including school districts taxes.

An additional exemption of up to $25,000 will be applied if the property’s assessed value is between $50,000 and $75,000. This exemption is not applied to school district taxes.

As an example, you need to have closed by December 31, 2024 and be able to state the home is your primary residence by January 1st of the year, eg 2025, to apply for the homestead exemption by March 1st, 2025 for the 2025 tax year. The property appraiser’s values are based on values in January of the year but the values and millage rates are not finalized and released until August of the year and taxes are due in November. There are discounts available if you pay by November.

If you have a mortgage with a lower down payment, the mortgage company will collect monthly and pay the taxes for you in November. Sometimes the lender has options with larger down payments to not include the taxes in your monthly payment by charging an add-on fee. If you pay cash, it is up to you to pay by November.

A $50,000 exemption can reduce your tax obligation quite a bit for a lower priced home, but it won’t make that much of a dent in a higher priced home. The advantage of a Primary Residence is the SOH cap each year to the increase in actual taxes.

Save Our Home Cap (SOH)

Homestead exemption also qualifies you for the 3% Save Our Homes Cap (SOH). In 1994 the State of Florida established a 3% Save Our Homes Cap (SOH) assessment limit on all residential properties that receive a homestead exemption.

The 3% SOH Cap limits any increase to the assessed value of a homestead exempt property for tax purposes to a maximum of 3% each year or the amount of the change in the Consumer Price Index, whichever is lower.

Properties are assessed at the Fair Market Value when a change of ownership occurs or you purchase a home, and in the first year it receives the homestead exemption.

Port St Lucie and St Lucie County have several different situations for land, infrastructure and utility development – the main part of St Lucie County’s 80,000 single family lots that are not part of a community or HOA and the subdivisions of St Lucie West have infrastructure and utilities built by the developer. So the only additional cost on the tax bill is for PSL (Port St Lucie) Stormwater Drainage of $183 per year and the PSL Solid Waste Assessment of $446.44 per year for a total of $629.44 and is listed as a non-ad valorem tax. This is the same cost for every single family residence in Port St Lucie.

Most of the new Construction communities and larger developments have utilized CDD’s or Community Development Districts. The Town of Tradition is actually one large CDD. Communities of PGA Verano, and Lennar’s Veranda Preserve have their own CDD. So this extra CDD can bring the cost of annual taxes higher than a home that is not part of a CDD.

A good estimate to ball park taxes on a new purchase is to calculate about 2% of the sales price as your base if you are not part of a CDD – it could be less but estimate about 2%. If you are part of a CDD, I would estimate about 2.5 – 2.75% of the purchase price.

As of the beginning of 2025, you see January 2024 values and taxes. Assessed values for 2025 will be established in January 2025, but not released until August 2025. So you will not see 2025 values and taxes until August 2025.

Assessed values increase as a percentage of the sales price. So if sales prices increase a lot over the prior year, assessed values will also increase substantially, which is what happened from 2021 to 2022. Increases since then have been more moderate in the 5% +/- range.

Once the exemption is applied for, the cap or base year is established, each year thereafter, the SOH cap applies. The 3% SOH Cap remains in effect as long as the property is homestead exempt or until the property is sold.