Floridians: Vote Yes on Amendment 1 on 1/29/08

2 01 2008

Floridians, our fate is in our hands. Passage of Amendment 1 will return money to homeowners right away and put nearly $10 billion back into Florida’s economy over the next five years.

This tax cut is in addition to the $15 billion property tax cut created during a June special legislative session that rolled back property taxes to 2006 levels. Here’s a recap:

Early in summer 2007, lawmakers passed landmark legislation to create the largest tax cut in Florida’s history. What passed was a two part process that put the people in control:

1. Step one was a law that required local governments to roll-back taxes in 2007, and then to grow at a responsible rate in the future.

2. Step two is in the hands of the People of Florida. On January 29, the people will have the power to cut their taxes in a historic way by passing the constitutional amendment. Floridians have the power and choice to lower their tax bill. They can decide what is best for their pocketbook on January 29, 2008.

Floridians need property tax relief

With the passage of Amendment 1, citizens will gain the freedom to purchase a new home without huge tax penalties, and rental home owners, second home owners and businesses will benefit by limited future tax increases.

The amendment contains two provisions: doubling the homestead exemption and portability of the Save Our Homes tax benefit.

Double the homestead exemption for almost all homeowners, providing an average savings of about $240 annually. The new exemption applies fully to homesteads valued over $75,000 and partially for homesteads valued over $50,000. This new exemption does not apply to school taxes.

Allow portability: Portability will allow homeowners to transfer their Save Our Homes tax benefits from their old home to a newly purchased home. Portability applies to homes purchased in 2007 and later, and the benefit is capped at $500,000.

If you upsize, you will be able to apply the dollar value of your Save Our Homes tax benefit to your new home.

For example:

Homesteader owns home valued at $300,000 and buys a new home valued at $400,000
If you downsize, you will be able to apply the percentage of the Save Our Homes benefit to your new home.

For example:

Homesteader owns home valued at $300,000 and buys a new home valued at $150,000
Provide an assessment cap of 10% for all properties, not previously capped: While homestead properties are already capped at 3%, now all other properties, including rental properties, second homes, and business properties, will be protected from huge increases in valuation. This new exemption does not apply to school taxes.
Create a new $25,000 exemption for business property, including office furniture, computers, machinery and equipment.

Estimates provided by the Legislature show that Florida homeowners and businesses will save over $12 billion in property taxes over the next five years.

Here are some fast facts about Amendment 1.

1. The property tax cut plan on the January ballot that would save taxpayers nearly $10 billion over five years.
2. Floridians have the power to cut property taxes by voting ‘Yes on 1’ on January 29, 2008.
3. Property taxes have doubled in the past six years outpacing the average growth of homeowner’s salary.
4. Local governments have used their increase in revenues to greatly expand their budgets and reserves, instead of returning it to Florida’s families and small businesses

Amendment 1 benefits those who want to move into a different home, seniors seeking to downsize, and business owners facing rising property values.

Have you been dreaming of moving into a bigger house because your family is growing? Have you lived in your home for years and are looking to buy a smaller home because the kids have grown up and moved to a new city? The scenarios below can help explain how the property tax cut from Amendment 1 will save your money.

Looking for a larger house?

If you bought a house for $95,000 in 1995 and its current market value now is $300,000 and the assessed value is only $150,000–you could transfer the full $150,000 difference to buy a more expensive home.

If the purchase of your new home costs $400,000, you would be paying about $6,300 in taxes without portability. But with the tax savings from Amendment 1 including the Save our Homes portability and the double homestead exemption, the new annual taxes would be about half or $3,600.

Want to downsize?

Under the new tax plan, portability also will apply if you want to move to a less expensive property. Instead of transferring the difference, your transfer will be your existing Save our Home percentage.

For example, if you live in a $300,000 house with an assessed value of $150,000, you pay taxes on $125,000 or about $2,100. If you wanted to move to a $200,000 condo the savings will be significant.

In this case, you would bring 50% or $100,000 in savings that reduces your assessed value to $100,000 on the new property. With the newly increased $50,000 homestead exemption from Amendment 1, the taxable value for all local government taxes other than school taxes would fall to $50,000. The new total annual tax bill would be about $1,000 or about half of the old tax bill.

Do you live in a mobile home?

More than 1.1 million Floridians currently live in mobile home or manufactured housing parks and communities. Currently, if you live on a leased lot in a park or community, you are paying tangible personal property taxes on your porches, sunrooms, storage rooms, and carports. With the passage of Amendment 1, you will have an exemption up to $25,000…so most of you will no longer pay this tax at all!

For more information, visit http://www.yeson1florida.com


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