Florida’s Amendment 5 ties the homestead exemption to inflation, automatically raising the second $25,000 layer of the homestead exemption each year when consumer prices rise. For the 2025 tax roll, that pushed the second-tier exemption from $25,000 to $25,722, reflecting the 2.9% increase in the Consumer Price Index for All Urban Consumers during 2024.1Florida Department of Revenue. Constitutional Amendment 5 Annual Inflation Adjustment to Homestead Exemption Value If you already have a homestead exemption on your Florida primary residence, the adjustment applies automatically. No paperwork, no application, nothing to file.
Which Part of the Exemption Gets Adjusted
Florida’s homestead exemption has two layers. The first $25,000 comes off the assessed value of your primary residence for all property taxes, including school district levies. A second $25,000 exemption applies only to assessed value above $50,000, and only reduces non-school taxes collected by your county, city, and special districts.2Florida Department of Revenue. Homestead Exemption Information
Amendment 5 only touches the second layer. The first $25,000 stays fixed. The second layer, previously frozen at $25,000, now grows each year by the percentage change in the CPI-U from the preceding calendar year.3Florida Senate. Florida Code 196.031 – Exemption of Homesteads For 2025, that means the non-school exemption now covers assessed value from $50,000 up to $75,722 instead of stopping at $75,000.
Two protections are built into the formula. The exemption only goes up: if the CPI-U falls in a given year, the exemption holds at its current level rather than shrinking. And each year’s adjustment builds on the prior year’s adjusted amount, not the original $25,000. That compounding is what makes the amendment meaningful over time rather than just symbolic.
How Much You’ll Actually Save
The first-year dollars are small. The $722 bump for 2025 reduces only the non-school portion of your bill. At a combined county, city, and special district millage rate around 15 mills (common across Florida), the extra relief works out to roughly $10 to $11 in 2025. Nobody is retiring on that.
The savings matter over the long haul. Each year’s inflation adjustment stacks on the last, so after five years of moderate inflation the exemption could sit $3,000 to $4,000 above the original base. After 15 or 20 years, cumulative annual savings could reach several hundred dollars, depending on inflation and your local millage. Homeowners who stay put the longest get the most out of it.
One thing to keep in mind: school district taxes, which make up a significant share of a typical Florida property tax bill, are not affected by Amendment 5 at all.1Florida Department of Revenue. Constitutional Amendment 5 Annual Inflation Adjustment to Homestead Exemption Value The amendment adjusts the non-school exemption only.
Looking ahead, the 2026 adjustment will reflect the 2025 calendar-year CPI-U change, which recent data suggests will land in the 2% to 3% range.4U.S. Bureau of Labor Statistics. Consumer Prices Up 2.4 Percent Over Year Ended February 2026
Do You Need to File Anything
If your homestead exemption is already on file with your county property appraiser, you don’t need to do anything. The Florida Department of Revenue calculates the adjusted exemption each year and provides it to local property appraisers statewide, who apply it to every qualifying homestead automatically.5Alachua County Property Appraiser. Constitutional Amendment 5 Annual Inflation Adjustment to Homestead Exemption Value
If you recently bought a home and haven’t claimed the homestead exemption yet, that’s the one piece of paperwork that matters. File an application with your county property appraiser by March 1 of the year you want the exemption to take effect. Miss the deadline and you can file a late application, but you may have to petition the Value Adjustment Board. Once the homestead exemption is in place, the Amendment 5 inflation adjustment applies to your property automatically from then on.
How It Works Alongside Save Our Homes
Save Our Homes and Amendment 5 are often confused, but they do different things. Save Our Homes caps how much your property’s assessed value can rise each year at the lesser of 3% or the annual change in the CPI-U.6The Florida Legislature. Florida Code 193.155 – Homestead Assessments That holds down the taxable base. Amendment 5 increases what gets subtracted from the base. The two protections stack and both reference the CPI, but they work on opposite sides of the calculation.
If you sell a homesteaded property and buy another in Florida, you can transfer up to $500,000 of accumulated Save Our Homes benefit to the new home by filing Form DR-501T with the new county’s property appraiser by March 1 of the year following the move. The Amendment 5 inflation-adjusted exemption isn’t portable in that same sense, because every qualifying homestead receives the same statewide adjusted figure. You don’t lose anything by moving; your new homestead picks up the current year’s adjusted amount automatically.
What Can Cost You the Exemption
The inflation adjustment only reaches properties that still qualify for the underlying homestead exemption. Lose the exemption and the Amendment 5 benefit goes with it. The rental rules trip people up most often.
Renting all or substantially all of a homesteaded dwelling counts as abandoning the homestead under Florida law. Renting the property for more than 30 days per calendar year for two consecutive years forfeits the exemption entirely.7Florida Senate. Florida Code 196.061 – Rental of Homestead to Constitute Abandonment Short-term rental listings catch homeowners who don’t realize the tax consequences of extended availability.
Using part of your home for business can reduce the exemption proportionally. And transferring title to an LLC, even for liability protection, will generally disqualify the property from homestead treatment altogether. Investment properties can sit in an LLC; your primary residence should stay in your own name or in a properly structured revocable trust if you want to keep the exemption.
What It Costs Local Governments
Because Amendment 5 shields more property value from taxation, it reduces revenue for counties, cities, and special districts. The impact starts small and compounds along with the exemption itself. By the fifth year of implementation, the annual statewide cost is projected to reach roughly $140 million.
The Legislature built in a cushion for the most financially vulnerable jurisdictions. Starting in fiscal year 2025-2026, state funds are appropriated each year to offset the revenue loss experienced by fiscally constrained counties, distributed in January based on each county’s share of the total statewide reduction.8Florida Senate. Florida Code 218.136 – Offset for Ad Valorem Revenue Loss Affecting Fiscally Constrained Counties Counties that don’t meet the fiscally constrained definition absorb the revenue reduction themselves.