Getting Married or Divorced? No More Taxes on your Marital Home!

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By Dane Leitner

In its last spring session the Florida Legislature revised a law for inter-spousal transfers of homestead property.  Section 201.02, Florida Statutes imposes documentary stamp tax on most conveyances between spouses if there is an underlying mortgage.  So, in Florida, when you get married and want to transfer property (add your spouse’s name to your home), a documentary stamp tax or “real estate transfer fee” is applied to the unpaid balance of the mortgage.  The Florida documentary stamp tax rate is $0.70 per $100 paid for the property, in all counties except Miami-Dade.

For example, if the husband owned the property prior to the marriage, then added his wife once married, and there was a mortgage balance of $400,000.00, the Department of Revenue would collect documentary stamp tax on half of the mortgage balance.  In this example the taxes would be around $2,800.00.

Previously, there was an exemption for the conveyance of the marital home when the parties divorced and the property was transferred.  However, there was no such exception if you wanted to add your spouse once married.  In 2018, the Florida Legislature amended the statute providing an exception for inter-spousal conveyance of homestead property if the conveyance was completed within one year of marriage.  While this was a good change, it only applied to parties that were getting married in the future, and as long as they conveyed the property within one year of the marriage.

In the 2019 legislative session the Statute was amended again, this time removing the one year requirement.

The amended Statute states:

201.02 Tax on deeds and other instruments relating to real property or interests in real property.

(7) Taxes imposed by this section do not apply to:

(b) A deed or other instrument that transfers or conveys homestead property or any interest in homestead property between spouses, if the only consideration for the transfer or conveyance is the amount of a mortgage or other lien encumbering the homestead property at the time of the transfer or conveyance.  This paragraph applies to transfers or conveyances from one spouse to another, from one spouse to both spouses, or from both spouses to one spouse.  For the purpose of this paragraph, the term “homestead property” has the same meaning as the term “homestead” as defined in s. 192.001.

The new amendment to the statute allows previously married couples that have been married longer than one year ago to transfer an interest in the homestead property to their spouse and not have to pay taxes on the conveyance.

This is a good change that will allow spouses to be added to property without having to pay the transfer taxes.  So now, whether you are getting divorced or married, this new amendment will ultimately save you money in the process.

 A partner at Ward Damon, Dane E. Leitner concentrates his practice in the areas of family and marital law, civil litigation and condominium and homeowner association law.  If you have questions regarding transferring property to your spouse during a marriage or divorce, or any other marital matters, contact Dane at dleitner@warddamon.com or call (561) 842-3000.

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