TO: All Florida Homestead Services Offices and Agents in Florida
SUBJECT: Abandonment of Homestead
Date: Oct 12, 2015
ABANDONMENT OF HOMESTEAD
Florida Stat. §196.061 Rental of homestead to constitute abandonment.--The rental of an entire dwelling previously claimed to be a homestead for tax purposes shall constitute the abandonment of said dwelling as a homestead, and said abandonment shall continue until such dwelling is physically occupied by the owner thereof. However, such abandonment of such homestead after January 1 of any year shall not affect the homestead exemption for tax purposes for that particular year so long as this provision is not used for 2 consecutive years. The provisions of this section shall not apply to a member of the Armed Forces of the United States whose service in such forces is the result of a mandatory obligation imposed by the federal Selective Service Act or who volunteers for service as a member of the Armed Forces of the United States.
History.--s. 1, ch. 59-270; s. 1, ch. 67-459; ss. 1, 2, ch. 69-55; s. 5, ch. 95-404; s. 8, ch. 96-397.
Note.--Former s. 192.141.
196.061 Rental of homestead to constitute abandonment.—
(1) The rental of all or substantially all of a dwelling previously claimed to be a homestead for tax purposes shall constitute the abandonment of such dwelling as a homestead, and the abandonment continues until the dwelling is physically occupied by the owner. However, such abandonment of the homestead after January 1 of any year does not affect the homestead exemption for tax purposes for that particular year unless the property is rented for more than 30 days per calendar year for 2 consecutive years.
(2) This section does not apply to a member of the Armed Forces of the United States whose service is the result of a mandatory obligation imposed by the federal Selective Service Act or who volunteers for service as a member of the Armed Forces of the United States. Moreover, valid military orders transferring such member are sufficient to maintain permanent residence for the purpose of s. 196.015 for the member and his or her spouse.
History.—s. 1, ch. 59-270; s. 1, ch. 67-459; ss. 1, 2, ch. 69-55; s. 5, ch. 95-404; s. 8, ch. 96-397; s. 3, ch. 2010-182; s. 18, ch. 2012-193; s. 1, ch. 2013-64.
Note.—Former s. 192.141.
A recorded document, executed by those claiming a homestead exemption, giving up said homestead. Not applicable to all states and procedure must be according to local laws & statutes.
Section 196.061, Florida Statutes," Rental of homestead to constitute abandonment", states in material part:
The rental of all or substantially all of a dwelling previously claimed to be a homestead for tax purposes shall constitute the abandonment of such dwelling as a homestead, and the abandonment continues until the dwelling is physically occupied by the owner. However, such abandonment of the homestead after January 1 of any year does not affect the homestead exemption for tax purposes for that particular year unless the property is rented for more than 30 days per calendar year for 2 consecutive years.
Loss of Homestead
The rental of an entire dwelling or a substantial portion thereof, previously claimed to be a homestead for tax purposes shall constitute abandonment of said dwelling as a homestead. Abandonment of such homestead after January 1st of any year shall not affect the homestead exemption for tax purposes for that particular year.
A. After the property has been designated as a homestead, it continues to be impressed with the homestead character, until the homestead character is lost by dissolution of the family relationship, a sale of the homestead, or its being abandoned as a homestead. Therefore, once it appears that property has been the homestead of a man and wife, any attempt to encumber of sell the property without conforming to the rules mentioned above would be invalid unless it can be proven that the property is no longer the homestead, due to some abandonment or termination of homestead rights. Abandonment of homestead is a question of fact to be determined on a case-by-case basis by a court or by a jury, and turns mainly on a question of intent of the parties to a transaction. Thus, if there is a temporary removal from the presumes, i.e. where a person is temporarily out of the country, moves temporarily for health purposes, or other such instances, there is no abandonment of the homestead, if it can be proved that the intent of the homestead claimants was to return to the property as their permanent homestead.
B. In a dispute between a homestead claimant and one who is attempting to put a lien on homestead property, the issue is frequently whether or not the homestead claimant has disclaimed his homestead rights, or would be estopped to raise this homestead claim. One of the basic principles is that a homestead claimant may not, merely by the fact of signing a written disclaimer of property as his homestead, preclude himself from later claiming the property as his homestead, even if this written disclaimer includes someone else to lend money against the homestead. Therefore, in such a case it would behoove the lender to make an examination of the occupancy of the property, and if the person is in fact residing in the property which is being mortgaged, a disclaimer signed by the person attempting to borrow money against homestead, would be invalid, if the claimant later contests that disclaimer and denies that the property was ever abandoned as his homestead.
Operation of Florida bankruptcy laws
In practice, occupation of a home requires a physical presence of the debtor on a regular basis. Problems arise because of multiple tracts, absence from the state, and divorce proceedings which fracture the application of domicile rules. Clarifying both domicile and residency through a written designation prevents surprises. If the validity of a homestead exemption is in question, written agreements and designation provide many debtor with a solution. Note: Absence from the country because of military service can not form the sole basis of abandonment.
To establish a property has been abandoned and therefore no longer shielded with the homestead exemption, the party questioning the homestead status must show by clear and convincing evidence the owner of the property 1) moved from the premises and 2) formed the intent never to return, either at the time of moving or sometime thereafter. This is primarily a question of the property owner's intent. This intent is determined not only from the property owner's declarations, but also from his acts and the circumstances surrounding his absence from the property. The fact that an owner is no longer using property as a principal residence may be relevant on the issue of abandonment, but it is not dispositive. An owner's temporary absence from the property or an owner's occupancy of another premises does not necessarily demonstrate an intent to abandon the homestead under the law. The law does not impose a requirement of continuous occupation to preserve a homestead. Similarly, the leasing of part or all of a homestead property does not as a matter of law establish an abandonment. Rather, a court must consider all the pertinent facts or circumstances in determining whether the owner formed the intent never to return. In evaluating an owner's intent, the Court must consider such factors as the length of the owner's absence, the reasons for the absence, purchase of a new home, etc.
A homestead interest is presumed to continue indefinitely absent proof of clear discontinued use and the intent to permanently abandon the homestead interest. Homestead protection is usually lost where the owner "abandons" the homestead by ceasing to use the property as a primary residence. Temporary renting of the homestead does not change homestead character, unless the owner acquires another homestead property. To prove abandonment, one must show that the claimant discontinued use and intended to permanently abandon the homestead. When homestead rights have been established, such rights are presumed to continue unless a challenger satisfies the burden of proving abandonment through competent evidence.
Under California law, a homestead can be abandoned only if the debtor has recorded a declaration of abandonment, records a new declaration of homestead on a different property, executes a conveyance of the homestead, or abandons the homestead by implication by establishing another residence as his principal dwelling
A homestead may be abandoned by implication under California law in two circumstances. First, implied abandonment occurs when the debtor has purchased a new residence because the automatic homestead exemption applies to the new residence. This is not the case here, as Kelley is a renter in Napa, not a property owner. Second, a homestead may be abandoned by implication where the debtor has shown no intention of using the property as a personal residence
The court has intentionally avoided applying In re Anderson, 824 F.2d 754 (9th Cir.1987), to this analysis. Fifteen years after its issuance, the rule in that case remains unclear. On the one hand, the court in Anderson specifically noted that continued residency is not a requirement for a valid declared homestead exemption, 824 F.2d at 757, and is often cited for that proposition. On the other hand, it seems to say later on the same page and following pages that 1983 changes in California law altered this rule. The court notes that subsequent state court decisions such as Webb v. Trippet have avoided any mention of Anderson. (1)The court in Webb v. Trippet specifically found error in the ruling of the trial court that continued residency was required. This case was handed down four years after Anderson. Anderson involved debtors who attempted to exempt a prior residence with a recorded declaration of homestead even though they had subsequently purchased and currently resided in another home. Instead of ruling that homestead law had changed, a better way to reach the same result would be to find, consistent with Webb v. Trippet, that purchase of the second residence constituted abandonment by implication of the declared homestead. Treatises on the subject treat Anderson as inconsistent with California law to the extent it holds that continued residency is required for a valid declared homestead exemption.
Cases from other jurisdictions either state that abandonment of a homestead is a question of fact [see, i.e.: Hildebrand v. Harrison, 361 P.2d 498 (Okla.1961); City of Jacksonville v. Bailey, 159 Fla. 11, 30 So.2d 529 (1947)], or treat it as a question of fact [see, i.e.: McIntosh v. Borchers, 196 Neb. 109, 241 N.W.2d 534 (1976); Monroe v. Monroe, 465 S.W.2d 347 (Ark.1971)]. The Oil Company emphasizes that the platting was done pursuant to a plan to sell. It concludes that the forming of a plan to sell part of a homestead and the efforts to effect such a sale constitute an abandonment of that part of the homestead. That is not the law in this State. If the grantee is to take title free from a lien of judgment against his grantor (Nelson v. Griggs County, supra), an abandonment cannot automatically be found to take place in the period of time which must exist between the point at which the grantor decides to sell and the point at which the sale is made. An attempt to sell or rent real property is not in itself evidence of abandonment of the homestead.
In Sullivan v. Barnett, 471 S.W.2d 39, 43(Tex.1971), when asked to find an abandonment in an attempted sale, the Texas Supreme Court said:
"An intention or attempt to sell a homestead does not amount to an abandonment as long as the homestead claimants retain possession and have no intent to abandon unless the sale materializes. [Cites omitted.]"
See also, Bellport v. Harder, 196 Kan. 294, 411 P.2d 725, 731 (1966), where the Kansas Supreme Court said:
"... the property did not lose its homestead character a few minutes before the deed was executed by the [sellers] to their daughter, as contended by the appellant, on the ground that they had formed an intention to abandon their home."
CONFUSION REGARDING HOMESTEAD AND TAXATION
A distinction should be made between the law relating to homestead and the enforcement of liens and the transferability of homestead property as contrasted with the character of the property with relation to the payment of AD VALOREM taxes. That is to say, if a t the beginning of a calendar year, an affidavit is filed by homestead claimant claiming certain property as his homestead, the tax assessor does not make inquiries as to whether or not the person requesting the exemption is in fact in possession of the property for which he claims an exemption. Therefore, if a homeowner owns a residence on the East side of town and a residence on the West side of town, but files a homestead exemption on the property on the West side of town which may have a higher value, and therefore, save some taxes. However, when the question is which property is mortgagable, the actual occupancy of the property is determinative, and if the residence is that property on the East side of town, it could not be mortgaged except in the instances outlined in SALES AND ENCUMBRANCES, regardless of the disclaimer of the homestead filed with the tax assessor.
The law regarding homestead involves highly technical principles. Care should be taken to have a lawyer review your facts if you are ever in doubt regarding the principles outlined herein. Because of the safeguards built into the law, transactions involving homestead property should be carefully structured.
It is important to note that because of the dangers involved with homestead, title companies and mortgage lenders are very particular in the treatment of homestead property. Even if legal principles are on the side of a title company or a mortgage lender, they may decline to take action based on internal policy principles and risk of loss, rather than relying entirely on the legal principles outlined herein. Therefore, if homestead property is to be conveyed or mortgaged, a review of the facts with the lawyer for the title company or for the mortgage lender should be made before the transaction is attempted, in order to determine that the transactions one into which the title company or mortgage lender desires to enter.
A change in the above law now allows for homeowners to take out a home equity loan on their homesteaded property.
Other Case Citations
"Continuous uninterrupted physical presence is not required to create a homestead." Burdick v. Burdick, 399 So. 2d 410 (Fla. 3d DCA 1981).
"A homestead is abandoned by taking up a permanent abode at a distant place. Whether there has been an abandonment of a homestead . . . should be determined by a consideration of all the pertinent facts and circumstances of each case." Miller v. West Palm Beach Atlantic Nat'l Bank, 142 Fla. 22, 194 So. 230 (1940).
In Dean v. Heimbach, 409 So. 2d 157 (Fla. 1982), the court found that involuntary absence from homestead, caused by legal problems of the owner, are insufficient to constitute abandonment of the homestead. The status of homestead is preserved "when the family unit is temporarily removed from the homestead but the homestead remains the permanent abode to which the family unit intends to return." Dean, 409 So. 2d at 158.
Novoa's testimony created an issue of fact as to his intention to return, and not abandon the homestead. Moreover, in granting summary judgment in this case, the trial court impermissibly weighed the credibility of Mrs. Novoa and disregarded her testimony that they intended to title the property as tenants by the entireties. This was improper, as credibility determinations must be made by a jury at trial. Novoa v. Amerisource, 860 So.2d 506, 28 Fla. L. Weekly D2717; Sierra v. Shevin, 767 So. 2d 524 (Fla. 3d DCA 2000); Jebailey.