Florida Property Tax Exemption For Affordable Housing

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The Application and Appeal Process

Key Date: January 1st is key date for determining whether property will be classified as exempt for any particular year - on that date the the property must owned by an "exempt entity" and be used for an "exempt purpose"

Application Deadline: The deadline to apply for the exemption is March 1st of the year for which the exemption is sought. Click Here to download the exemption application (form DR 504).

Late filing with the Appraiser is possible but it must be done within 25 days of the date that the the owner receives the annual notice of assessed value from the Appraiser in August or September. The late filing must be accompanied by evidence demonstrating good cause for missing the deadline or other extenuating circumstances (CLICK HERE to download the late filing form). If the Appraiser denies the late filing the owner can file the application directly with the Value Adjustment Board (which must also be done within the same 25 day deadline mentioned above)

Appeals. If an exemption is denied the Appraiser will send a notice to the owner (usually in July). As is indicated on the notice, the owner can ask for an informal meeting with the Appraiser's office to discuss the denial. Whether or not the owner asks for such a meeting an appeal can be made to the Value Adjustment Board using Form DR-486. Such an appeal must be requested within 30 days after issuance of the denial notice (this appeal deadline is stated in the small print near the bottom of the denial notice)


Preparing the Application

Where do you put the Narrative on the Application?: Question #9 on form DR-504 asks you to describe the "use of the property". Please note that there is not enough space on the application form to provide an adequate answer. Applicants should should simply type "see attached" and then attach a narrative describing in detail the exempt use of the property

Preparing the Narrative - Three approaches depending on your situation

• SAFE HARBOR #1 - OCCUPIED RENTAL UNITS: The portion of a property actually occupied by eligible low income tenants that are actually paying affordable rents can be deemed to have a charitable use. Click Here to see the statutory requirements.


Property under this particular safe harbor can qualify even if it is NOT owned by 501(c)(3) entity provided that it is owned either by a limited liability company (LLC) or a limited partnership in which the sole "member" (in the case of an LLC) or the sole "general partner" (in the case of a limited partnership) has that type of IRS exemption.


• SAFE HARBOR #2 - "AFFIRMATIVE STEPS" - Even if there are currently no occupied rental units on the property, it can be considered being used for charitable purposes if the exempt owner has taken "affirmative steps" to prepare the property to provide affordable housing to low income persons in the future. Click Here to see the statutory requirements.


• GENERIC "CHARITABLE USE" EXEMPTION - Other properties not covered by one of the above mentioned safe harbors must can possibly qualify under the generic "charitable" use exemption. Click Here for the statute. This might include vacant land that is being held for future development. There is a two part test:
  
  
  • OWNERSHIP: The property must be owned by an nonprofit "exempt entity". Click here for the statute that defines the term "nonprofit". The owner doesn't necessarily need to be 501(c)(3) but it certainly helps.
  
  
  • Note: The statute allows the property to be owned by a limited liability company (LLC) provided the LLC is wholly owned by a qualified nonprofit "exempt entity".
  
  
  • USAGE: The property must be USED for a "charitable purpose". Click here for the statute defining the term "charitable use"
  
  

Sample Narratives - for answering question #9 on exemption application (DR-Form 504)

• Safe Harbor #1 - Occupied rental units


• Safe Harbor #2 - Unoccupied multifamily building undergoing (or about to undergo) rehab - the narrative argues that the owner is taking "affirmative steps" to create affordable housing. This sample can be modified for use with single family properties


• Generic "charitable use" exemption - For example, land banking property to use for future development of affordable housing


• Note: Given that the statute defines "chartiable purpose" as a "function or service which is of such a community service that its discontinuance could legally result in the allocation of public funds for the continuance of the function or service" your narrative should highlight all of the government funding that you (hopefully) plan to use.