2026 Legislative Update: The Future of Florida Property Taxes and Tax Deed Sales

2026 Legislative Update: The Future of Florida Property Taxes and Tax Deed SalesAs the 2026 Legislative Session progresses, the Florida House of Representatives has advanced historic proposals that could fundamentally alter the property tax landscape for homeowners. While these measures aim to provide significant tax relief, they contain specific provisions that ensure the continued functioning of the state’s tax enforcement and tax deed sale systems.

The Proposed Elimination of Non-School Property Taxes

The most significant development is the House’s passage of HB 203 and its companion HJR 203. This joint resolution proposes a constitutional amendment to phase out non-school property taxes for homesteads.

Under this proposal, the homestead exemption for non-school ad valorem taxes would increase by $100,000 annually for 10 years. By January 1, 2037, homestead properties would become fully exempt from all property taxes except for those levied by school districts. A separate measure, HJR 201, proposes an even more immediate exemption from these same non-school taxes.

Will Properties Still Be Available at Tax Deed Sales?

Yes, properties will remain available for purchase at tax deed sales. Although these legislative efforts significantly reduce the tax burden for homestead owners, they do not eliminate property taxes entirely.

Several key factors will maintain the tax deed auction pipeline:

  • School District Levies Remain: All current proposals specifically exclude school district taxes from the exemptions. Homestead properties will still be subject to these levies, and failure to pay them could still lead to tax delinquency and eventual tax deed processes.
  • Non-Homestead Property Status: These sweeping tax eliminations apply specifically to homestead properties. Commercial real estate, rental properties, and other non-homestead assets remain subject to traditional tax assessments.
  • Assessment Modifications: HJR 213 proposes changing the frequency of assessments for both homestead and non-homestead properties to once every three years. For non-homestead properties, it also proposes raising the maximum assessment increase cap from 10% to 15%.

New Protections and Oversight

The legislature is also considering measures to protect both homeowners and the state’s fiscal integrity:

  • Insurance Relief: HJR 209 proposes a new $200,000 exemption tier for homesteads that carry comprehensive multiperil insurance, providing additional relief on non-school taxes.
  • Portability for Families: HB 215 would allow married couples to combine their prior homestead assessment differences when moving to a new home, up to a $500,000 limit.
  • Fiscal Oversight: To ensure local government compliance with these new laws, HB 1303 proposes the creation of the Florida Agency for Fiscal Oversight (FAFO). This agency would have the authority to audit local governments that increase taxes and could withhold state funds for noncompliance.

Next Steps and Voter Approval

It is important to understand that these changes are not yet final. Because these proposals involve constitutional amendments, they must be approved by 60 percent of Florida voters in the 2026 general election. While the House has passed its version, the Senate is still considering its own proposals. If approved by the voters, the initial exemptions would be slated to begin on January 1, 2027.

For those participating in tax deed sales, the process is expected to continue, though the specific tax debts leading to auctions for homestead properties may shift primarily toward unpaid school district obligations.

View all the latest bill updates from the Florida House of Representatives and the Florida Senate.

About Tax Deed Closings

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How Florida’s New Legislation Plans to Eliminate Property Taxes While Providing Alternative Funding Sources

How Florida's New Legislation Plans to Eliminate Property Taxes While Providing Alternative Funding SourcesThe 2026 Florida Legislative Session has reached a pivotal turning point as lawmakers advance historic proposals to eliminate non-school property taxes for homestead properties while simultaneously restructuring the state’s fiscal oversight and revenue mechanisms. As of February 2026, the House has passed significant joint resolutions that, if approved by voters, would fundamentally change how local governments are funded.

The Path to Property Tax Elimination

The primary vehicle for this transition is HB 203 and its companion HJR 203, which passed the House with an 80-30 vote. This legislation proposes a constitutional amendment to exempt homestead property from all non-school property taxes beginning January 1, 2027.

The plan offers two potential trajectories for elimination:

  • Phased-In Repeal: Under HJR 203, the homestead exemption for non-school taxes would increase by $100,000 annually for 10 years, leading to a full exemption by 2037.
  • Immediate Repeal: HJR 201 proposes a more rapid constitutional amendment to exempt homesteads from all ad valorem taxes other than school district levies.

It is important to note that school district taxes are excluded from these repeal efforts and would continue to be levied on all properties. Furthermore, any of these constitutional changes must be approved by 60 percent of Florida voters in the 2026 general election to take effect.

Alternative Funding and Fiscal Strategies

To manage the loss of local property tax revenue, the legislature is exploring several alternative funding sources and budgetary adjustments:

  • Federal “Piggybacking”: A major fiscal consideration this session is the state’s adoption of federal tax changes from the One Big Beautiful Bill Act (OBBBA). Revenue estimators indicate that adopting these changes at the state level could have a $1.5 to $3 billion revenue impact that must be reconciled within the state budget.
  • Budgetary Efficiency and Reductions: Both the House and Senate are continuing a recent trend of reducing overall spending, with proposed budgets for FY 2026-27 totaling between $113.6 and $115 billion. Additionally, HB 1329 would mandate a budget-cutting exercise for local governments, requiring them to identify 10% in possible reductions before final budget adoption.
  • Cash Transaction Rounding: On a smaller scale, HB 951 and SB 1074 would authorize dealers to round cash or mixed-use purchases to the nearest nickel, providing a minor adjustment to how sales revenue is handled at the point of purchase.

Oversight and Protection of Local Services

To ensure that the elimination of property taxes does not lead to a collapse of essential services or fiscal irresponsibility at the local level, the legislation introduces new layers of state oversight:

  • Florida Agency for Fiscal Oversight (FAFO): HB 1303 proposes the creation of this new agency within the Department of Financial Services. FAFO would be granted the authority to audit local governments that levy or increase taxes and could impose fines or withhold state funds for noncompliance.
  • Law Enforcement Funding Floors: To protect public safety, the repeal proposals specifically prohibit local governments from reducing law enforcement funding below established base-year levels, ensuring these services remain a priority regardless of the tax structure.

Conclusion

While the proposed legislation moves Florida toward a future without non-school property taxes for homeowners, the state is preparing for the transition through a combination of strict fiscal oversight via FAFO, budgetary contractions, and the strategic adoption of federal tax standards. As the session moves into its final weeks, these proposals await reconciliation between the House and Senate before potentially heading to the 2026 ballot.

View all the latest bill updates from the Florida House of Representatives and the Florida Senate.

About Tax Deed Closings

Tax Deed Closings provides you with an innovative program to qualify your tax deed properties for immediate closing, without the time and expense of a quiet title action. Click Here to find out more information about Our Program.