Florida is not eliminating property taxes, but the state has capped how much they can rise

Florida still collects property taxes—counties assess them, and homeowners pay them. What changed is the rate of increase. In 1992, Florida passed an amendment that limits how much the assessed value of your home can jump each year, even if the market value shoots up. That cap is 3 percent annually, with some exceptions. This means your tax bill grows more slowly than it would in states without a cap, but you are still paying property tax.

The confusion often comes from headlines about "property tax reform" or talk of eliminating property taxes entirely. Those are separate proposals that have circulated in the legislature over the years but have not become law. The 3 percent cap is the actual rule in place right now.

Key Takeaways

  • Florida caps the annual increase in assessed home value at 3 percent, so your property tax bill grows slower than market values do.
  • This cap applies to homestead properties (your primary residence) and has been in effect since 1992.
  • When you sell your home, the assessed value resets to the current market value, and the 3 percent cap starts over with the new owner.
  • Non-homestead properties and commercial real estate are not subject to the 3 percent cap and can be reassessed at full market value each year.
  • Property taxes remain a major source of revenue for Florida counties, schools, and local services—they have not been eliminated or replaced.

How the 3 percent cap works on your home value

When you own a homestead property in Florida, the county assessor determines its market value. That market value is what your property tax is based on. However, the assessed value—the number used to calculate your actual bill—can only increase by up to 3 percent per year, no matter how much the market value climbs.

Here is a concrete example: if your home's market value is $300,000 in year one, the assessed value might be $300,000. In year two, even if the market value jumps to $330,000, your assessed value can only rise to $309,000 (3 percent of $300,000). You pay tax on $309,000, not $330,000. This gap between market value and assessed value is called "save our homes" value, and it protects long-term homeowners from sudden tax spikes.

The cap resets when you sell. The new owner's assessed value starts at the current market value, and the 3 percent cap begins again for them. This is why long-time homeowners often pay significantly less in property tax than their neighbors with identical homes who bought more recently.

What happens when you buy or sell a home

If you purchase a home in Florida, your assessed value begins at the market value you paid (or the appraised value, whichever is lower). From that point forward, the 3 percent annual cap applies to you. If you sell and buy another home, the same process repeats—the new home's assessed value starts fresh at market value.

This reset is one reason why property tax bills can surprise new buyers. A home that sold for $400,000 will have an assessed value near $400,000 initially, even if the previous owner was paying tax on an assessed value of $250,000 due to the cap. The new owner's tax bill will be substantially higher in year one, then grow at 3 percent annually.

Non-homestead properties and commercial real estate

The 3 percent cap only applies to homestead properties—your primary residence. If you own rental property, a vacation home, or commercial real estate in Florida, those properties are reassessed at full market value every year. There is no cap on how much the assessed value can increase.

This means investors and business owners can face significant year-to-year swings in property tax bills if the market is moving fast. Counties use the full market value each January 1st to set the assessed value for non-homestead property, so a rising real estate market directly translates to higher taxes for these owners.

Where Florida property tax revenue goes

Property taxes fund schools, county services, fire departments, libraries, and local infrastructure. Florida does not have a state income tax, so property tax and sales tax are the main sources of state and local revenue. Counties set their own millage rates (the tax rate per $1,000 of assessed value), so the amount you pay varies by location.

A portion of your property tax bill goes to the county, a portion to schools, and portions to special districts like water management or fire protection. You can see the breakdown on your tax bill. Because property tax is so important to funding local services, proposals to eliminate it entirely would require replacing that revenue with other taxes—something the legislature has not done.

Recent proposals and legislative changes

Over the past several years, lawmakers have proposed various property tax changes, including raising the homestead exemption (a deduction applied before tax is calculated) or adjusting the 3 percent cap. Some proposals have passed; others have not. In 2023, for example, the homestead exemption was increased, which reduced the assessed value subject to tax for homeowners who may have access to.

These changes are different from eliminating property tax altogether. When you see news about "property tax relief," it usually means adjusting exemptions, raising caps, or shifting how the tax is calculated—not removing the tax itself. The state legislature continues to debate property tax policy, but the fundamental system remains in place.

How to understand your property tax bill

Your annual property tax bill shows the assessed value, the millage rate, and the total tax owed. If you believe your assessed value is wrong, you can challenge it through the county assessor's office. The process is called a "value adjustment board" hearing, and you can request one if you think your home was overvalued.

You can also check your assessed value online through your county assessor's website—most counties have searchable databases. Comparing your assessed value to similar homes in your area can help you decide whether to file a challenge. If you are a homeowner over 65, disabled, or a veteran, you may may have access to for additional exemptions that reduce your assessed value further.

Frequently Asked Questions

Will Florida ever eliminate property taxes completely?

There is no current plan to eliminate property taxes. Proposals to do so have been introduced in the legislature but have not passed. Property tax funds schools and local services, so eliminating it would require replacing that revenue with other taxes. Any major change would need legislative approval and likely voter support.

Why did my property tax bill jump so much after I bought my home?

Your assessed value resets to market value when you buy. If the previous owner had owned the home for many years, their assessed value was likely much lower due to the 3 percent cap. Your bill is based on the current market price, not what the previous owner paid in tax.

Can I reduce my property tax bill?

You may be able to claim a homestead exemption if you own your primary residence, which reduces the assessed value subject to tax. You can also challenge your assessed value if you believe it is too high. Some homeowners over 65, disabled, or veterans may have access to for additional exemptions. Contact your county assessor for details.

Does the 3 percent cap explore to rental properties?

No. The cap only applies to homestead properties (your primary residence). Rental properties and investment real estate are reassessed at full market value every year, so taxes can increase significantly if property values rise.

What is the homestead exemption, and how does it work?

The homestead exemption is a deduction applied to the assessed value of your primary residence before tax is calculated. It reduces the amount of value subject to tax. The amount varies by county and has been increased in recent years. You must explore for it through your county property appraiser's office.