Florida Homestead Exemption for Trusts and LLCs

Florida’s homestead exemption provides two major benefits — property tax savings and legal protection from most creditors. However, when a home is owned by a trust or limited liability company (LLC), these protections can become more complicated. Understanding how ownership structure affects the homestead exemption is essential for both homeowners and estate planners.

Below, we explain how homestead rights apply to properties titled in a trust or LLC and what steps can help preserve the exemption. For a broader overview of homestead benefits, visit our main page on the Florida Homestead Exemption.

Homestead Exemption Basics

The Florida Constitution grants a homestead exemption to permanent residents who own and occupy their property as a primary residence. This exemption provides both property tax savings and protection against forced sale by most creditors. To qualify, the homeowner must have legal or beneficial title to the property and must live in it as their permanent residence as of January 1 of the tax year.

While individual ownership is straightforward, ownership through a trust or entity adds a layer of complexity because the law focuses on whether the person actually living in the property has a qualifying ownership interest.

Homestead Property Owned by a Revocable Trust

Florida law allows a property held in a properly drafted revocable living trust to maintain homestead status, but the trust language is critical. The trust must identify the property as the settlor’s (creator’s) residence and state that the settlor has the right to live in the home during their lifetime. If those conditions are met, the property appraiser will typically recognize the exemption.

Key points for homestead property held in trust:

• The settlor must be a Florida resident and occupy the property as their permanent residence.
• The trust must clearly grant the settlor the right to use and occupy the property for life.
• The deed transferring the property into the trust should identify the trust properly and include language preserving homestead rights.
• The trust should specify who inherits the property after the settlor’s death, consistent with Florida’s constitutional homestead restrictions.

If the trust does not include clear occupancy and ownership language, the property could lose its homestead exemption and associated creditor protections. This is why reviewing your trust with an attorney experienced in both real estate and estate planning is so important.

Homestead and Irrevocable Trusts

Property placed in an irrevocable trust usually cannot qualify for the homestead exemption unless the trust specifically allows the grantor to retain a beneficial interest that meets Florida’s residency requirements. Because the grantor gives up control and ownership in an irrevocable trust, property appraisers often view these arrangements as non-qualifying. Each trust must be reviewed individually to determine whether the structure meets Florida’s constitutional standards.

Homestead Property Owned by an LLC

Florida courts have consistently ruled that properties titled in the name of a limited liability company (LLC) do not qualify for the homestead exemption. This is because the LLC, not the individual, is considered the legal owner of the property.

Even if the homeowner is the sole member of the LLC and lives in the property full-time, the property appraiser will generally deny the exemption because the individual does not hold personal title. The Florida Constitution limits homestead protections to natural persons, not business entities.

In addition, a property owned by an LLC does not receive creditor protection under Article X, Section 4 of the Florida Constitution. Creditors may reach the property to satisfy business debts or other claims against the entity. This distinction often surprises homeowners who place property into LLCs for liability or estate planning purposes.

Balancing Liability Protection and Homestead Status

Some property owners consider titling their primary residence in an LLC to shield it from liability, especially if they also use it for business or rental purposes. However, doing so will typically forfeit both the property tax exemption and the constitutional protection from creditors. For most homeowners, the homestead protection itself offers stronger safeguards than an LLC could provide.

If you own rental or investment properties, holding those in an LLC can make sense. But your primary residence should generally remain titled in your name or in a properly drafted revocable trust that preserves your homestead rights.

Homestead and Estate Planning

In estate planning, properly managing homestead property within a trust can streamline inheritance, avoid probate delays, and maintain tax benefits. However, the trust must comply with Florida’s homestead restrictions — particularly when the homeowner is married or has minor children. Because these restrictions are constitutional, they override conflicting provisions in a will or trust.

A well-drafted estate plan ensures that your trust language, deed, and property title all work together to preserve both the homestead exemption and creditor protection.

How Barnes Walker Can Help

At Barnes Walker, our attorneys regularly assist clients with reviewing and structuring property ownership to preserve Florida’s homestead exemption. We help homeowners determine whether holding a property in a trust or individual name is best for their goals and ensure that trust documents are properly drafted to maintain protection under Florida law.

We also assist Realtors, title professionals, and financial advisors in navigating ownership and homestead questions during sales, transfers, and estate planning transactions.

Learn more about the Florida Homestead Exemption here, or contact our office to discuss how to structure ownership of your Florida home while keeping your homestead rights intact.

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Key Takeaways

• Homestead property can remain protected in a revocable trust if the trust grants the homeowner full occupancy and beneficial ownership rights.
• Properties owned by an LLC do not qualify for the Florida Homestead Exemption or constitutional creditor protection.
• Irrevocable trusts generally do not qualify unless they retain specific beneficial ownership language consistent with Florida law.
• Proper estate and title planning can preserve both homestead tax savings and legal protection for your primary residence.