Florida resets your assessed value to full market price on January 1 following the sale. The seller's Save Our Homes cap, which limited increases to 3% or CPI annually, disappears completely at closing. A home taxed at $5,000 under a long-time owner can bill $18,000 for you. Budget roughly 1.8% of your purchase price instead of the current bill.
The Reset Happens on January 1 After Closing
One statute explains the entire surprise, and buyers rarely encounter it before it hits their escrow account. Florida Statute 193.155(3) resets a property to just value on January 1 of the year following any change in ownership.
On the Discover South Florida Podcast, Larry Mastropieri reduced the mechanism to one sentence.
"Property taxes reset based on the new purchase price."
Your closing date determines nothing about that timing. A March purchase and a November one both trigger the same reassessment on the following January 1.
The Seller's Cap Never Transfers to You
Long-time owners accumulate a protection that you cannot inherit. Save Our Homes limits annual assessment increases on homesteaded property to 3% or the change in CPI, whichever runs lower. Decades of that shelter compound into an enormous gap.
Larry walks through the arithmetic with a familiar scenario.
"Say that owner bought their home for 200 grand in the 1970s and they've had it homesteaded for the past 55 years. Their property tax could not increase because there's this thing in Florida where you can't increase your property tax more than 3% a year. So their property tax might be five grand."
Your purchase wipes that accumulated benefit away entirely.
"You just paid a million for this property. The property appraiser is now going to reassess your property based on the market sale price."
Sellers in Delray Beach and Boca Raton who bought decades ago carry bills that mislead every buyer who reads them. The resulting number bears no resemblance to what you will owe.
"You buy the property and you're uneducated and you say, oh, my property tax is going to forever be five grand. That's not the case. Your property tax is going to be close to 1.8% of sale price, which is going to be $18,000."
Why Your First Year Looks Deceptively Normal
The delay between purchase and reassessment creates a false sense of security, and Larry explains the sequence clearly.
"In 2026, you're still going to pay what the previous owner was paying most likely. They're not going to change it that fast if you bought it in August."
Year two delivers the number you should have budgeted for.
"Then 2027 comes around and the property appraiser sees the sale, they do their appraisal, they say the assessed value is 800, now you're paying $16,000 and you almost fall off your seat."
Escrowed payments amplify the shock, since your lender adjusts the monthly figure to cover the higher bill plus any shortfall from the prior year. Buyers throughout Palm Beach County see monthly payments climb by several hundred dollars in that second year.
Florida Taxes Are Paid in Arrears
The payment structure adds another layer worth understanding.
"Property taxes are paid in arrears. At the end of 2026, the big portion of the property tax you're paying is for 2026."
An August 1 closing therefore leaves the full year's bill sitting ahead of you.
"You get a credit as the buyer from the seller for January 1 through August 1, because you, the new owner, are going to be responsible for paying the full property tax amount at the end of the year."
Larry stresses what that credit at closing actually represents.
"They don't pay the taxes. They give you the money so you can pay the taxes in the future."
The Proration Uses Last Year's Number
The calendar forces an estimate instead of a calculation, since the current year's amount rarely exists yet.
"They do the proration based on the property tax amount that has been approved, if it's been approved, which in most cases it's not. So what do they do? They look back to 2025."
Approval of the current rate arrives late in the calendar year.
"It doesn't get approved till much later in the year, closer to November."
Your credit therefore reflects the seller's capped, discounted tax history instead of your actual future bill. That gap between the credit and the eventual reset is where buyers get caught.
Do the listed taxes on a home look too good? Talk to a real estate agent near Boca Raton who runs the reassessment math on every property before you write an offer. Reach out to The Mastropieri Group or call (561) 544-7000.
The Credit Assumes You Pay Early
One detail catches buyers who plan to pay in March. Florida discounts early payment on a fixed schedule, and the proration accounts for it.
"If you pay by the end of November, then you get a 4% discount. When you do the proration in Florida, they're giving you the prorated amount with the discount included. It assumes you're going to pay the property tax by the end of November."
Discounts run 4% in November, 3% in December, 2% in January, and 1% in February. A payment made in March costs full price on a credit calculated at the discounted rate, and that difference stays with you.
How Much Should You Actually Budget?
Larry gives buyers a working estimate they can apply immediately.
"A lot of people use a quick rule of thumb, 1.8% of sale price is what you pay in property tax."
He applies that figure without exception across price points.
"You want to buy a million-dollar home, great, be prepared to pay $17,000 in property tax. I don't care what property you're buying. I don't care if this guy's property tax is currently $6,000. You're paying a million bucks, you're likely paying that number."
Real precision comes from the county appraiser itself.
"You can go on the Palm Beach County Property Appraiser site and plug in how much you're going to pay. Plug in if you homestead, it'll give you all the discounts, and it'll show you exactly what they estimate you're going to pay."
Every South Florida county offers a version of that estimator. Run it before you write an offer, since the result reflects your price instead of the seller's history. Buyers in Palm Beach Gardens should do the same on every property they tour.
Stop Shopping by the Current Tax Bill
Every listing site displays the seller's taxes, which misleads buyers constantly. Larry hears that same mistake on showings every week.
"I hear this all the time from buyers. Oh, I like this property because property taxes are low."
His correction leaves no room for interpretation.
"Don't look at the property taxes as an indication for whether you want to buy this property, because it doesn't matter at all. Zero impact on your decision."
Two comparable homes at the same price will cost you nearly identical taxes regardless of what their current owners pay. A bill of $4,000 on one and $14,000 on another simply reflects how long each owner held the property. Both reset to the same basis after you buy.
What You Can Do to Lower It
- File for homestead exemption by March 1, worth $51,411 in 2026 against assessed value.
- Apply for portability to transfer up to $500,000 of accumulated Save Our Homes benefit.
- Pay in November each year to capture the 4% discount.
- Review your TRIM notice in August and petition the Value Adjustment Board if the assessment looks wrong.
- Claim senior, veteran, or disability exemptions where you qualify.
- Verify your escrow analysis so the increase does not arrive as a lump shortfall.
Portability deserves attention from anyone who already holds a Florida homestead. A move within the statutory window carries substantial protection into your new property, and buyers relocating within Broward County overlook that filing constantly.
What About Investors and Second Homes?
Non-homestead property carries a 10% annual assessment cap instead of the 3% Save Our Homes limit. That protection also resets on sale, and it never applies to the school portion of your bill.
Owners under the 10% cap must notify the property appraiser promptly when ownership or control changes. Failure to report can produce a lien for back taxes, 15% annual interest, and a penalty equal to half the taxes avoided. Investors buying in West Palm Beach should calendar that notification.
Dates Worth Marking
- January 1 is the assessment date, and the reset lands here the year after you buy.
- March 1 is the homestead and portability filing deadline.
- August brings TRIM notices showing your proposed assessment and millage.
- Late October is when tax bills mail, with payment opening November 1.
- November 30 is the last day to capture the 4% discount.
- March 31 is the final due date, with delinquency starting April 1.
Millage rates and exemption amounts change annually, and this page describes general practice. Your county property appraiser provides the authoritative estimate for any specific property.
Know the Real Number Before You Write the Offer
Nobody should learn their actual tax bill fourteen months after moving in, yet it happens constantly because listing sites publish the previous owner's number. We run the reassessment estimate on every property we show and factor in homestead and portability where they apply. What you get is a monthly payment that survives year two. Reach out to The Mastropieri Group, Realtors® at (561) 544-7000 and send us an address and we will tell you what the taxes will actually be.