2013 Spring newsletter

LEGAL CORNER Many thanks to Lainie for asking me to submit an article for the Legal Corner section of the FCIAAO newsletter. My favorite part of the newsletter has always been From the Peanut Gallery by Bruce Strenth. Over the years, I have greatly enjoyed Bruce’s light-hearted, keen observations along with his true fondness for FCIAAO and its membership. With that in mind, the following is a summary of a few recent court deci- sions and a list of pending legislation. The homestead tax exemption, while appearing so simple in concept, is consistently one of the most challenging ―routine‖ decisions made by the property appraiser’s office. The concept is deceptively easy; every person that owns a home and permanently resides in it is entitled to the exemption. Per- haps the apparent simplicity is what makes the exemption oftentimes complex. How much time and resources does your office spend administering the homestead tax exemption and monitoring for homestead fraud? “Perhaps the apparent simplicity is what makes the exemption oftentimes complex.” “There’s no place like home.” Dorothy in the Wizard of Oz. A very recent decision addressed the short-term rental provisions of section 196.061, Florida Statutes (2012). Rosenbaum v. Garcia, no. 10-30841 CA 25 (11th Jud. Cir. Ct. Feb. 20, 2013). In that case, the owners rented their homestead property for two short periods of time during 2005-2008. The first period was from December 1, 2005 to April 30, 2006. The second period was from December 21, 2007 to April 20, 2008. Upon discovery of the rentals, the property appraiser removed the homestead ex- emption and filed a lien for tax years 2006-2009. The trial court held that the short-term rentals over a period of four consecutive years required the homestead exemption to be removed beginning in the second year pursuant to section 196.061, which provides that rental of the homestead ―after January 1 of any year shall not affect the homestead ex- emption for tax purposes for that particular year so long as this provision is not used for 2 consecutive years.‖ Because the property was leased for two, short-term periods over four consecutive years, the removal of the exemption beginning in 2006 was upheld. Last year, three differences between the homestead tax exemption and the homestead protection from forced sale were discussed in Grisolia v. Pfeffer, 77 So.3d 732 (Fla. 3d DCA 2012). First, the owner’s failure to apply for homestead tax exemption did not disqualify the property from receiving the home- stead forced sale protection. Second, the general rule that statutes should be strictly construed against the taxpayer, which applied in the context of homestead tax exemption, did not apply to the home- stead forced sale protection. Rather, a liberal construction was applicable. Third, the homestead forced sale protection did not require the owner claiming the protection to reside on the property. In- stead, it was sufficient that the owner’s family reside on the property. Thus, the court held that the de- cedent and his widow, who were in the United States under temporary visas and actively pursuing per- manent resident status prior to his death, were entitled to the homestead forced sale protection where their American-born minor son had resided on the property since its purchase. Loren Levy, Esq.

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Spring 2013 Newsletter of the FCIAAO