Saturday, August 22, 2015

Florida Homeowner's Homestead Exemption Claim Covering Multiple Homes To Score Real Estate Tax Breaks OK, As Long As Properties Are Contiguous, Not Rented Out

In Hollywood, Florida, the South Florida Sun Sentinel reports:
  • Retiree Karen Caputo owns four homes in Hollywood and claims one tax exemption on all four of them.

    A few folks, apparently, have a problem with that. Caputo, a Hollywood activist, has been reported to the Broward County Property Appraiser's Office twice as a possible tax cheat.

    But what Caputo is doing is perfectly legal, says Property Appraiser Lori Parrish. "We recommend lots of people do this," Parrish said. "They just combine them for tax purposes."

    Caputo combined her neighboring properties under one title in 2008 after reading a story in the Sun Sentinel saying the practice was legal.

    It was legal then and it's legal now, says the Florida Department of Revenue, which oversees property appraisers throughout the state.

    "You can combine contiguous parcels into a single homestead," said Renee Watters, a spokeswoman for the Department of Revenue. "It does not matter if the contiguous parcels have structures on them. We do not know how common the practice is, but it does occur."

    The Palm Beach County Property Appraiser's Office says the practice is valid as long as the properties are contiguous and not being rented out.

    "In Palm Beach County, we would also give them a homestead exemption on the combined property," said Chief Deputy Property Appraiser Dorothy Jacks. "If she started to rent them out, the home would be considered a commercial property and she would lose the exemption."

    Caputo says she is not renting out the homes and lives in three of them. The fourth she uses as a guest house for relatives when they come to visit. "I've never rented them and I never intend to rent them," she said of her homes on Garfield and Arthur streets in eastern Hollywood.

    Caputo pays nearly $50,000 in property taxes each year, she said.

    "I pay more property taxes than most of the city commissioners," she said."I bought the houses to garden, for the land. My four houses are small [two-bedroom, one-bath] worth the price of one nice house. I would much rather have four quaint small houses on three-quarters of an acre than one expensive one on one-quarter acre. It wasn't my intention when I started, but it turned out to be a good thing."

    Parrish established a fraud division 10 years ago to go after homeowners who were claiming homestead exemptions on properties that were not their primary residences.

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