Ballot explainer: Amendment 5 Homestead Exemption Adjustment

Florida voters will consider a constitutional amendment this November that could affect property taxes for millions of homeowners across the state. As the cost of living continues to rise, this proposal aims to address how inflation impacts one of Florida's key property tax benefits. The amendment's outcome could have far-reaching effects on both homeowners' tax bills and local government revenues for years to come.

For the full text, click here.

This amendment is about property taxes on your home. In Florida, homeowners get a tax break called a homestead exemption, which reduces the taxable value of their primary residence. Right now, this exemption is a fixed amount. The amendment suggests that this exemption should increase each year to keep up with inflation, but only for non-school taxes.

For example, if you have a $50,000 homestead exemption today, it might be worth less in real terms five years from now due to inflation. This amendment would adjust that $50,000 upward each year so it maintains its real value. However, this adjustment wouldn't apply to the portion of your property taxes that fund schools.

The change would start on January 1, 2025, if approved. It's meant to help homeowners by ensuring that rising prices don't gradually eat away at the value of their tax exemption. However, it's important to note that this could potentially reduce tax revenues for local governments over time.

• A majority of Republican legislators in the Florida House and Senate, who voted to put Amendment 5 on the ballot
• Many homeowners, particularly those with fixed or lower incomes

• It will benefit Floridians, especially seniors and those with lower incomes, who struggle with rising property taxes.
• It's particularly beneficial in high-growth areas, where property values have surged.
• The measure will help rein in government and keep taxes under control.

• Florida League of Cities
• Florida National Organization for Women
• NAACP Florida State Conference
• Florida Democratic Party
• Florida for All Coalition
• A majority of Democratic lawmakers in the Florida House and Senate, who voted against placing Amendment 5 on the ballot.

• Homeowners already benefit from existing property tax limitations that act as a hedge against inflation, making this amendment unnecessary.
• Local governments would lose nearly $23 million in the 2025-26 fiscal year, according to a legislative analysis. Within a few years, those losses would reach nearly $112 million.
• As a result, it may force local governments to either cut services or raise millage rates to maintain current service levels.
• The amendment could exacerbate housing affordability issues by potentially increasing rents, as landlords pass on higher property tax costs to tenants.
• Ultimately, it deepens existing inequalities in the property tax system, widening the gap between homesteaded and non-homesteaded property owners.
  

• Require the value of homestead exemptions to be adjusted annually for inflation, potentially reducing property tax burdens for homeowners over time, except for school district taxes.
• Reduce local government revenue from property taxes, excluding school district taxes.

• Keep homestead exemptions at their current fixed values, without automatic adjustments for inflation.
• Maintain current local government revenue levels from property taxes.
• Preserve the existing balance of tax burden between homesteaded and non-homesteaded properties.

Find the rest of the amendment explainers here.