Florida voters expand homestead tax exemption to $150,000
Amendment 3 passed with 62% of the vote, reducing property taxes for homeowners but creating an estimated $5 billion funding gap for local governments.
By Zoe Harrison ·
Florida voters approved Amendment 3 on Tuesday, a constitutional change that will lower property tax bills for many residents. The measure received approximately 62% of the vote, clearing the 60% threshold required for passage.
The amendment restructures the homestead exemption, which reduces the taxable value of a primary residence. Starting in 2027, homeowners will not pay property taxes on the first $150,000 of their home's assessed value. This is a tripling of the current exemption, which stands at roughly $50,000. The exemption amount will increase to $250,000 in 2028 and is subject to inflation adjustments in subsequent years.
The change also impacts non-homestead properties, such as commercial buildings and rental units. Currently, the taxable value of these properties can increase by up to 10% annually. The new law caps that increase at 5%. New residents moving to Florida will not qualify for the expanded exemption until their fifth year of receiving the previous, smaller exemption.
Local governments will bear the cost of the tax savings. A state economic analysis estimates that local tax revenues will drop by nearly $5 billion in the first year. That figure is projected to rise to approximately $9 billion the following year, with a long-term recurring loss of nearly $12 billion. Jackson Peel, communications director for the Save Our Services - No on 3 campaign, noted that communities will face difficult choices. "You're going to see cuts to local services and programs, or you're going to see tax increases," Peel said.
The new rules will not apply to 2026 property tax bills. Assessments and calculations for the current tax year will follow existing state law. The changes take effect at the start of 2027. Governor Ron DeSantis, who initially sought a larger tax cut, expressed pride in the outcome. "I'm very proud of everyone that had been a part of that," DeSantis said at a press conference on Wednesday morning.
DeSantis stated that a special legislative session will be necessary before his term ends to pass implementing legislation. He indicated he would defer to lawmakers on scheduling the session. "I'll probably let them pick the dates. You know, I'm basically on lame duck duty at this point," he said. DeSantis described the amendment as the start of a larger effort to eliminate property taxes. He also proposed a Taxpayer Bill of Rights to limit alternative tax methods and a state-funded grant pool for local government core needs.
Republican Representative Byron Donalds will succeed DeSantis as governor on January 5. Donalds has stated he wants to fully repeal homestead property taxes if the budget allows. DeSantis said he would work with the incoming administration to find solutions for those goals.
The amendment creates a complex transition for both residents and local officials. Homeowners will see lower bills, but local services may face budget pressures. The state government will now determine the specific mechanisms for these changes through legislation.
