tax burdenThose owning real property in Lee County have likely received their annual TRIM (Truth in Millage) Notice. We have found that some questions continue to repeat every year once taxpayers receive their TRIM Notices.

To help taxpayers understand what the TRIM means for them, we thought it would be helpful to go through a few quick tips for what to look for when reviewing this important document: Continue Reading Helpful Tips for Reviewing your TRIM Notice

Many clients come to us when they purchase a condominium or home for investment income. One of the questions that often arises is whether they should hold their investment real estate in a separate legal entity for tax and liability purposes.

Our recommendation for most clients is that they should consider the formation of a Florida limited liability company (LLC). A Florida limited liability company offers the liability protections most often associated with a corporation, while have the tax attributes of holding the property in your individual name.

In an LLC, each owner holds a “membership” interest, often described as “units” or “percentages” that define their individual ownership, much in the way that a corporation is owned by shares of stock. The LLC should have an Operating Agreement setting forth the terms and conditions (think of them as “rules”) of ownership. There are many options in deciding what should go into an Operating Agreement. You should discuss these options with your attorney when creating the LLC.

Protections of an LLC

Continue Reading Should I Form an LLC for My Beach Rental?

tax.jpgIn the past few months, several clients have contacted me with questions regarding property that had been obtained through tax deeds. For example, one client contacted me to discuss property that had been purchased from an individual who obtained the property through a tax deed sale two years earlier. At the recent purchase, the client had obtained an owner’s title policy; however, there was an exception to this policy for anyone claiming by, through or under the prior owner whose title to the property had been disgorged by the tax deed sale. My client intended to develop the property into a multi-unit residential complex and wanted to be certain that they could provide clear title to the eventual third-party purchasers.

Background

Prior to a property being sold at auction via a tax sale, several things must have occurred or, in some cases, not occurred. By way of example, let’s say that “Adam” is an individual who owns a 10 acre tract of vacant land in Lee County, Florida. After the 2008 real estate crash, Adam fell on hard times and failed to pay the 2008 ad valorem taxes due and payable on March 1, 2009. On April 1, 2009, the taxes for Adam’s property were deemed delinquent and the tax collector, as required by law, advertised Adam’s property (along with other delinquent properties) once a week for three consecutive weeks for the sale of a tax certificate on the delinquent 2008 taxes. Once the delinquent properties had been properly advertised, the tax collector established an on-line auction for a tax certificate for the delinquent 2008 taxes.

Continue Reading Tips for Understanding Tax Deeds and Tax Certificates

Property Tax.JPGIn prior posts, we mentioned the basic timing of the property tax system in Florida. As a reminder, important dates to keep in mind are:

  • January 1: all property in the State must be assessed based on its condition on that particular date (I like to call this the “snapshot photo” date);
  • March 1: the general deadline to submit exemption applications;
  • July 1: local property appraisers generally have their values determined;
  • Mid-August: TRIM notices are mailed to inform property owners of their proposed assessment and tax bill for that year;
  • September: 25 days from the date of mailing the TRIMs, the appeal period expires if you want to appeal through the Value Adjustment Board; and,
  • November: taxes can be paid for the greatest discount.

Which begs the question, “what can I do now if I’m thinking about my property taxes but haven’t paid attention to these dates?” Here are 5 quick things you can be doing: Continue Reading 5 Things You Can Do Now to Prepare for 2012 Property Taxes

George Wheeler is a 30 year employee with the Florida Department of Revenue. He currently serves as IDP Administrator in Classified Use Administration. His responsibilities as Senior Appraiser at DOR include the areas of agriculture/greenbelt, conservation, and working waterfront.

Since a recent article in the Florida Land Development News about property taxation and potential exemptions, we have received numerous questions about the treatment of conservation lands for ad valorem taxation. We first ran into this issue some time ago, and had the pleasure of working with George Wheeler with the Florida Department of Revenue to determine the best option for the landowner in that case. For this blog post, we imposed on George again and he was kind enough to chat with us about this rather misunderstood area of property taxation.

Continue Reading Thoughts on Ad Valorem Assessment of Conservation Lands: A Conversation with George Wheeler

It’s that time of year again – the time we rush to our mailboxes to see if today’s the day we receive our TRIM (truth in millage) notices from the Lee County Property Appraiser showing our proposed property taxes for 2011.

Generally, the TRIMs are mailed mid-to-late August and contain a lot of information you should be aware of. Specifically, once you receive your TRIM, take notice of the following:

  • the proposed assessed value of your property;
  • the deadline to file any challenges administratively – this date is 25 days from the date the TRIM is mailed so you don’t have a lot of time;
  • the dates of hearing for any particular taxing authority if you disagree with the proposed tax rate; and
  • be sure your property address and STRAP (parcel identification) number are correct – otherwise, you may pay tax on the wrong property!

It is also important to note whether any exemptions you may qualify for have been correctly applied. Your TRIM will contain contact information for Property Appraiser staff who can assist you with specific questions you may have. Henderson Franklin’s Land Use attorneys may also be able to assist you with any appeals you may decide to file.

In my household, a letter from the county property appraiser or the county tax collector is typically met with a “what-now” groan because it’s rare for good news to come from those offices. If you’re an agricultural land owner, you may have recently received such a letter from your local property appraiser notifying you that your agricultural tax classification for the 2011 tax year has been denied. And while a groan may be the proper response, tossing this letter in a pile and ignoring it is not – because you now only have 30 days to appeal this denial to the county’s Value Adjustment Board.

An agricultural classification can save a property owner tens of thousands of dollars in property tax owed to the local government, and according to the Lee County Property Appraiser’s Agricultural Division, agricultural classification denials for Lee County were mailed on or about June 27, 2011. Typically, the rationale for denial is that the property is not being “used primarily for bona fide agricultural purposes” as required by F.S. 193.461(3)(b). Any appeal of this determination must be timely filed, and evidence and testimony must be presented at a hearing to support the contention that a bona fide agricultural use existed on the property as of January 1, 2011. The statute sets forth 7 factors to be considered in determining whether a “good faith commercial use of the land” was in place:

  1. The length of time the land has been so used.
  2. Whether the use has been continuous.
  3. The purchase price paid.
  4. Size, as it relates to specific agricultural use, but a minimum acreage may not be required for agricultural assessment.
  5. Whether an indicated effort has been made to care sufficiently and adequately for the land in accordance with accepted commercial agricultural practices, including, without limitation, fertilizing, liming, tilling, mowing, reforesting, and other accepted agricultural practices.
  6. Whether the land is under lease and, if so, the effective length, terms, and conditions of the lease.
  7. Such other factors as may become applicable.

These appeals can become extremely complicated, and without the presentation of competent, relevant evidence and testimony, a property owner’s chances of success can be very low. So, if you tossed that denial letter in a “to-do” pile, dig it out and consider whether you would like to appeal the denial. The filing fee to appeal the denial is as low as $15, however waiting too long to address the issue can be quite costly.