Will You Lose Florida Homestead Protections If You Put Your Property in a Trust?

Florida offers some of the strongest homestead protections in the country. These protections shield your primary residence from most creditors, reduce your property taxes, and place restrictions on how the property can be passed on if you’re married or have minor children.

But many people wonder if they’ll lose those benefits by transferring their homestead into a trust.

The short answer is that you can transfer your Florida homestead to a properly drafted revocable trust and still retain your homestead exemption. But if the trust isn’t written carefully, you could accidentally give up your homestead benefits.

How Florida Homestead Protections Work

There are three distinct types of homestead protection under Florida law: property tax exemption, creditor protection, and restrictions on transfer at death. The tax exemption reduces the assessed value of your home, which lowers your annual property tax bill. The creditor protection prevents a forced sale of your home by judgment creditors. The transfer restrictions prevent a homeowner from disinheriting a surviving spouse or minor child.

Each of these protections depends on the homeowner making the property their permanent primary residence in Florida. But they don’t require the homeowner to hold title in their own name individually. That’s where a revocable trust can fit in.

Placing a Homestead in a Trust

A Florida resident can transfer their homestead into a revocable living trust without losing the property’s protections. The key is that the trust must be structured to preserve the homeowner’s right to live in the property and maintain control over it during their lifetime.

A valid trust for homestead purposes will clearly state that the person transferring the home—usually the settlor—has the right to use and occupy the property for life. The trust should also assign that person the obligation to pay property taxes and maintain the property, just as they would if they owned it outright.

If the trust removes these rights or gives control of the property to someone else, the homeowner may lose both creditor protection and the tax exemption.

Spouses, Minor Children, and Inheritance Issues

Even when transferring the homestead into a trust, Florida’s constitutional restrictions on inheritance still apply. If a homeowner is married or has minor children, they cannot freely decide who inherits the property. The state limits the ability to leave a homestead in a trust in a way that bypasses a spouse or minor child.

For example, if a homeowner tries to transfer the homestead in trust to someone other than a surviving spouse, the law may override that provision and instead grant the spouse a life estate or another form of legal interest. Trusts that ignore these rules could be challenged in probate or lead to unintended outcomes.

If you want your homestead to remain protected and also pass to your spouse or children according to your wishes, the trust must follow Florida’s constitutional limits on devise. That usually means giving the surviving spouse a life estate or full ownership, depending on the situation.

Will You Lose the Tax Exemption?

Florida allows a homeowner to keep their homestead tax exemption when the property is held in a revocable trust, but only if the trust preserves the homeowner’s beneficial interest in the property. In other words, the trust must give you the right to live there and treat it as your residence.

If your trust is vague or doesn’t clearly give you that right, the county property appraiser could deny or revoke your homestead exemption.