Florida Homestead Protection from the IRS
Florida's unlimited homestead exemption is one of the strongest asset protections in the country. The IRS respects it.
Florida's homestead exemption under Article X, Section 4 of the Florida Constitution protects your primary residence from most creditors with no dollar limit. The lot can be up to half an acre in a municipality or 160 acres outside one. The IRS can place a lien on the property, but they almost never seize a homestead.
More importantly, the homestead exemption directly reduces your Reasonable Collection Potential in an Offer in Compromise calculation. If your home has $300,000 in equity, and it qualifies for the homestead exemption, that equity is excluded from the RCP formula. This can be the difference between an offer of $5,000 and an offer of $300,000.
In Bankruptcy Too
In Chapter 7 bankruptcy, the Florida homestead exemption protects your home while qualifying tax debt is discharged. This combination — keep the house, eliminate the tax debt — is one of the most powerful strategies available to Florida residents.
Tax attorney Darrin Mish has spent 32 years getting taxpayers out of IRS trouble. Free consultation — no obligation.
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