In Florida, homeowners can enjoy significant property tax savings and legal protections through the homestead exemption, even if their home is owned by a living trust. Eligibility depends on the trust’s structure and specific circumstances.

How a Living Trust Can Own Your Home and Qualify

Florida law allows properties in a revocable living trust to qualify for the homestead exemption. The key is that the trust beneficiary, who must also live in the home, maintains direct control over the trust.

To qualify, the individual must have the authority to revoke the trust, thus maintaining control over its assets. The trust’s beneficiary must use the property as their primary residence to meet the exemption requirements.

This ensures that the homestead protection and tax benefits are granted to those who genuinely use the property as their main home, in line with the spirit of the Florida Constitution’s homestead exemption.

Revocable vs. Irrevocable Trusts: What’s the Difference?

The type of trust—revocable or irrevocable—plays a crucial role in determining eligibility for the homestead exemption.

For revocable trusts, where the settlor (the person who creates the trust) retains the ability to amend or revoke the trust, qualifying for the exemption is more straightforward. This is because the settlor is seen as the equitable owner of the property, as they maintain control over the trust’s assets, including the home.

Irrevocable trusts, on the other hand, involve the settlor giving up control over the trust’s assets, complicating the homestead exemption claim. In such cases, the trust beneficiary—who must reside in the property—must prove they hold an equitable title to the property, which is harder without the direct control typical of revocable trusts.

Key Legal Requirements for Homestead Exemption

To qualify for the homestead exemption when your home is held in a trust, several conditions must be met:

• Beneficial Ownership:

  The individual claiming the homestead exemption must be the beneficial owner of the property, meaning they have the right to live in the home and benefit from its use. The trust document must clearly state that the individual has a beneficial interest in the property.

• Residency Requirement:

  The applicant must physically reside in the home and intend to make it their permanent residence.

• Type of Trust:

  The trust must be revocable, allowing the grantor to maintain control over the trust assets, including the ability to amend or revoke the trust. This control is crucial for the property to qualify for the homestead exemption.

Steps to Secure Your Homestead Exemption with a Trust

1. Document Review:

   Ensure that the trust documents explicitly state that the grantor (or another specified beneficiary) has the right to use and occupy the property as their primary residence.

2. Application Process:

   When applying for the homestead exemption, provide the county property appraiser with the trust agreement along with standard proof of residency. This typically includes a Florida driver’s license, Florida vehicle registration, and voter registration, all showing the homestead address.

3. Clarify the Trust’s Terms:

   Additional documentation may be required to clarify the terms of the trust, proving that it meets Florida’s requirements for a homestead exemption.

Conclusion

To maximize your property tax savings, ensure your home qualifies for the Florida homestead exemption, even if it is held in a living trust. At Lumsden Law Firm, our experienced attorneys can guide you through the complexities of trust structuring and homestead exemption qualifications. Contact us today to schedule a consultation and ensure you receive the benefits you deserve.

For more information and to start planning your homestead exemption application, visit Lumsden Law Firm.