Local governments across Florida are losing revenue because banks are getting the homestead-exemption tax breaks intended for the homeowners whose properties the lenders have repossessed, according to a report in the in The Sun Sentinel.
Homeowners qualify for Florida's homestead exemption — a tax break intended for people who live in the house they own — on January 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: depositories and servicers 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.
The Florida Department of Revenue said it is unable to determine how much local governments statewide may be losing in taxes on foreclosed houses with homestead exemptions. In just the third quarter alone, Florida recorded more than 34,000 foreclosure sales, according to RealtyTrac Inc.
