Florida Homestead When Your Spouse Lives in Another State

A husband makes Florida his permanent home. His wife stays in Pennsylvania, near the grandchildren. Can he claim Florida's homestead property tax exemption? And what happens if she keeps the homestead break on the Pennsylvania house?

The first question is usually easy. The second is where couples get hurt. A spouse living outside Florida does not by itself disqualify the Florida homeowner. A spouse claiming a residency-based tax break in another state very often does.

One spouse can qualify alone

To claim the exemption, you must own the property and make it your permanent residence in good faith as of January 1. Section 196.031(1)(a) even anticipates a married couple who own a home as tenants by the entireties where only one of them lives there. That owner gets the exemption. Both spouses do not have to move.

Florida does have to be your real home. Under section 196.015, the property appraiser looks at evidence such as a recorded declaration of domicile, a Florida driver's license (and evidence you gave up licenses from other states), voter and vehicle registration, the address on your federal tax return, where you bank, and proof you pay the utilities. No single factor is conclusive. A license alone settles nothing, and your actual living arrangements have to match the paperwork.

The real problem: your spouse's exemption up north

Florida's Constitution allows "not more than one exemption" to "any individual or family unit." Art. VII, § 6(b), Fla. Const. The statute adds a second bar. Under section 196.031(6), a person "receiving or claiming the benefit of" a property tax exemption or credit in another state that requires permanent residency is not entitled to Florida homestead. There is a narrow exception for an owner who keeps the Florida home as the permanent residence of a dependent.

The other state's benefit does not have to be called "homestead." What matters is whether you must live there to get it. Pennsylvania's Homestead and Farmstead Exclusion is a good example. It applies only where the dwelling is primarily used as the owner's domicile, 53 Pa.C.S. § 8401, so it is exactly the kind of residency-based benefit Florida looks for. The Pennsylvania exclusion is usually worth far less than Florida's exemption and the Save Our Homes cap combined.

Courts treat an intact marriage as one family unit

Titling each house, and each exemption, in a different spouse's name does not solve the problem. In Endsley v. Broward County, 189 So. 3d 938 (Fla. 4th DCA 2016), the wife held the Florida exemption and her husband held a residency-based exemption in Indiana. They had been married since 1944 and shared finances. The court held she received the benefit of his Indiana exemption through their joint finances, and it upheld removal of her Florida exemption. She also lost the Save Our Homes cap, which is often the more expensive loss.

Separate money is not enough either. In Brklacic v. Parrish, No. 4D12-2597 (Fla. 4th DCA Sept. 3, 2014), the spouses kept separate homes in Broward and Palm Beach Counties and separate accounts, and they never lived together day to day. They spent weekends and holidays together. The court held an intact marriage is one family unit, and the appraiser's lien for eight years of exemptions stood.

The narrow exception: truly separate lives

Marriage does not always mean one family unit. In Wells v. Haldeos, No. 2D09-4250 (Fla. 2d DCA Oct. 22, 2010), a Pasco County husband kept his Florida exemption even though his wife, from whom he had been separated since 2003, lived in New York and held a New York exemption. The parties stipulated they had separate permanent residences, no financial connection, and gave each other no benefits, income, or support. The court relied in part on the Department of Revenue rule recognizing separate "family units," Fla. Admin. Code R. 12D-7.007(7), and expressly limited its holding to those "unique circumstances."

The line is substantive. Two homes kept for work, family, or lifestyle do not make two family units. A genuine separation and independent finances might, but the applicant carries the burden of proving it.

What to do

For most married snowbirds the answer is simple: keep one exemption, and make it Florida's. Have the spouse up north ask that state's assessment office to remove the residency-based benefit in writing, and keep the confirmation.

Apply for Florida homestead on Form DR-501 with the property appraiser in the county where the home sits, by March 1 of the tax year. § 196.011, Fla. Stat. The form asks each applicant whether they claim residency or homestead in another county or state. Answer it accurately. If you are relying on the separate-family-unit exception, be ready to document the separation and your financial independence.

Dropping the out-of-state benefit fixes the problem going forward. It does not erase prior years. Under section 196.161, a property appraiser who finds an improper exemption can go back up to ten years and assess the unpaid taxes, a 50 percent penalty, and 15 percent annual interest, secured by a lien on your Florida property. If you have been claiming in two states, talk to counsel before the appraiser finds it.

Homestead at death is a different question

Everything above concerns the property tax exemption. Florida's homestead protections from creditors and its restrictions on leaving the home at death are separate rules under Art. X, § 4, Fla. Const. One point surprises couples in this situation: a spouse who lives in Pennsylvania is still a surviving spouse under Florida law. A married Florida homeowner generally cannot leave the homestead to the children instead of the spouse unless the spouse has signed a valid waiver. If your estate plan assumes otherwise, it needs review.

Zacharia Frey PLLC helps snowbird couples sort out residency, homestead, and estate planning across Florida and Pennsylvania. Call our Bonita Springs office at (239) 345-4545.