Here is the latest oddity out of Florida: Homestead-exemption tax break, intended for resident homeowners who actually live in their Florida homes, is instead accruing to the banks that are repossessing homes via foreclosure.
The Orlando Sentinel has the details:
Local governments across the state are losing revenue because banks are getting the homestead-exemption tax breaks intended for the homeowners whose properties the lenders have repossessed.
Homeowners qualify for Florida’s homestead exemption — a tax break intended for people who live in the house they own — on Jan. 1 of each year. Once a homeowner qualifies for the exemption, that property gets a tax break of at least $750, even if the house changes hands by the time its tax bill arrives in the fall.
The result: Banks are paying less in property taxes than they would otherwise because they inherit the previous owner’s homestead exemption when they foreclose on a property.
Another unintended consequence of a property tax break . . .
Cities, counties lose big bucks as banks get tax breaks on repossessed homes
Orlando Sentinel, December 12, 2010