Why Your Tax Bill JumpsIn Year Two

A buyer looks at a listing, sees "Taxes: $3,180," does the math, and builds a budget around it. Fourteen months later the escrow analysis arrives and the payment has gone up by three or four hundred dollars a month. Nobody lied to them. They were reading a number that had nothing to do with them.

Florida has now legislated against this misunderstanding twice — once by requiring a warning in the contract, and again in 2026 by requiring listing platforms to stop showing the seller's taxes as if they were the buyer's. It is worth understanding why.

The mistake, stated plainly

Florida already requires this warning in every residential contract or an incorporated disclosure:

And a 2026 law goes further. HB 7031E requires online residential listing platforms, effective 1 February 2027, to display estimated property taxes using a Department of Revenue standardized methodology based on the listing price — not the seller's current taxes. A platform that declines to estimate may not display the seller's current taxes at all, and must direct consumers to the county property appraiser's estimator.

Until that takes effect, do the estimate yourself. Every Central Florida county property appraiser publishes an estimator; use the purchase price, not the current assessed value.

The homestead exemption

Florida's homestead exemption comes in two tiers, and only one of them applies to school taxes.

• First $25,000 of assessed value — exempt from all levies, including school district levies.
• An additional exemption on assessed value above $50,000 — exempt from all levies other than school district levies. This tier has been CPI-indexed annually since the 2025 tax year, following the passage of Amendment 5 in 2024.

The Department of Revenue publishes the indexed figure: $25,000 for 2024, $25,722 for 2025, and $26,411 for 2026. So a qualifying homestead in 2026 carries a total exemption of $51,411.

The requirements are strict about one date. You must own and hold legal or beneficial title and, in good faith, make the property your permanent residence as of January 1. The application is due to the property appraiser by March 1. Closing on 3 January does not get you a homestead exemption for that year — it gets you one starting the following January.

Save Our Homes is not a flat 3%

This is one of the most commonly mis-stated facts in Florida real estate writing. In a low-inflation year the cap is below 3%. It is a ceiling, not a rate.

There is a parallel cap for non-homestead property: 10% per year, applying to residential property with nine or fewer units and vacant residential under section 193.1554, and to ten-or-more-unit and most nonresidential property under section 193.1555. Like the homestead exemption's second tier, it does not apply to school district levies — that is a constitutional limitation. It resets on a change of ownership or control, and also resets when homestead property loses homestead status without changing hands.

The year-two reassessment, step by step

Here is the actual chain, with the statutes that drive each link.

The size of the jump depends entirely on how long the seller owned the home and how much values moved during that time. A house sold by an owner of eighteen months may barely move. A house sold by an owner of twenty-two years, whose assessed value has been creeping up at the lesser of 3% or CPI while market value did something else entirely, can move a great deal.

Certain transfers do not trigger reassessment — section 193.155(3) carves out transfers between spouses, transfers to a surviving spouse, and certain joint-tenancy changes.

Portability

If you already have a Florida homestead and you are moving within Florida, portability lets you carry your accumulated Save Our Homes benefit with you.

• The cap on what transfers is $500,000 of assessment difference — or the difference between just value and assessed value on the prior homestead, whichever is less.
• The window is three years. The prior homestead must have received the exemption as of January 1 of any of the three immediately preceding years. The clock runs from abandonment, not from the sale date.
• New for 2026: HB 7031E, effective 1 July 2026, allows the benefit to port from any homestead abandoned in the prior three years. Previously it could only come from the immediate prior homestead.
• Upsizing (new just value at or above the old): you transfer the full benefit, up to $500,000.
• Downsizing: the benefit transfers proportionally — prior assessed value multiplied by (new just value ÷ prior just value).

Portability is not automatic. Form DR-501T must accompany the homestead application, by the same March 1 deadline. People lose real money by missing it.

Your TRIM notice

The Notice of Proposed Property Taxes — "Truth in Millage" — is mailed by the property appraiser each August. It shows market value, assessed value, exemptions and taxable value; last year's taxes; the rolled-back rate; the proposed millage and the resulting taxes; and the date, time and place of each taxing authority's budget hearing.

It is also your deadline clock. A Value Adjustment Board petition on value must be filed on or before the 25th day following the mailing of the TRIM notice. A petition on denial of an exemption must be filed within 30 days of the mailing of that notice. Those are short windows and they are not extended because you were on vacation.

The part of the bill that homestead does not touch

Your Florida tax bill carries two different kinds of charges. Ad valorem taxes are based on value. Non-ad valorem assessments are not — they are set by the levying entity, not the property appraiser, and simply ride along on the same annual bill.

In Central Florida the big one is the Community Development District assessment, created under chapter 190 to repay the bonds that built the community's roads, utilities, stormwater systems and amenities. Fire and solid waste assessments and PACE assessments appear the same way.

These matter disproportionately here because so much of the region's inventory sits in master-planned communities in Osceola, Polk, Lake and west Orange counties. And the key point is a negative one:

Amendment 3, on the November 2026 ballot

The Legislature passed CS/HJR 1F on 2 June 2026 — House 75–26, Senate 30–9 — placing it on the ballot under the title "Increased Homestead Exemption; Lower Cap on Increases in Non-Homestead Property Assessments." If approved, it takes effect 1 January 2027.

What it would do:

The revenue side is substantial and is why this is contested. House staff analysis projects a reduction of $4.95 billion in local non-school revenue in FY 2027–28, $8.78 billion in FY 2028–29, and $11.86 billion recurring. Orange County's own published projection is a reduction of roughly $165 million in 2027 and $275 million in 2028.

Two things a buyer should take from this. First, the five-year phase-in for new residents matters enormously if you are relocating to Florida. Someone establishing residency after 31 December 2026 would start at a $50,000 non-school exemption rather than the full amount — a meaningfully different arithmetic from what a long-time Florida homeowner would get. Second, even if it passes, the first bills reflecting it would appear on the August 2027 TRIM notices. Nothing changes this year.

Two other property-tax-adjacent measures — Amendment 1 on the Budget Stabilization Fund and Amendment 2 on tangible personal property on agricultural land — are also on the 2026 ballot. Neither affects homesteads.

What to actually do

• Estimate your own taxes from the purchase price using the county property appraiser's estimator, before you write the offer. Not from the listing.
• Ask your lender how they are escrowing year one. Many escrow off the seller's current bill, which means year two brings both a higher tax bill and an escrow shortage to make up. That is how a payment moves twice.
• File for homestead by March 1 of the year after you establish residency. File the DR-501T at the same time if you have portability to transfer.
• Read the TRIM notice in August. Diary the 25-day and 30-day appeal deadlines.
• Add up the non-ad valorem lines separately — especially the CDD, if there is one.

None of this is avoidable, and none of it is a reason not to buy. It is a reason to budget from the right number.