Guide
Commercial Property Tax in Florida: What Owners and Buyers Need to Know
Florida has no state income tax, so property tax carries more of the load, and for commercial property it has a feature that surprises buyers every year: the assessment cap resets when the property sells. A building the seller pays tax on at a capped value is reassessed at its market value for the buyer, and the tax bill can rise sharply. Every underwriting starts there.
Ask a Commercial Specialist · (786) 914-1017
Just Value, Assessed Value and the Cap
The county property appraiser sets a just (market) value each year. For non-homestead property, the assessed value cannot rise more than ten percent a year regardless of the market, so a long-held building's assessed value can sit well below its just value. The cap applies to the non-school portion of the bill. When the property changes ownership, the cap is lifted and the assessed value resets to just value the following year.
What That Means for a Buyer
A buyer's tax bill is based on the reset value, not the seller's bill. Underwrite with an estimate of the post-sale assessment (often near the price) times the local millage, not with the seller's operating statement. Under a triple-net lease the increase passes to the tenants and can strain them; under a gross lease it comes straight off the owner's income.
Millage, TRIM Notices and Appeals
The tax is the assessed value, less exemptions, times the combined millage of the county, city, school board and special districts, which differs by location. Each August the appraiser mails a TRIM notice with the proposed value; an owner who disagrees can petition the value adjustment board within the period the notice states, with evidence such as income data, comparable sales or an appraisal. Confirm deadlines with the county property appraiser.
Tangible Personal Property
Equipment, furniture and fixtures used in a business are taxed separately as tangible personal property, with an annual return due to the appraiser and an exemption for the first portion of value. A buyer of a business or an owner-user building takes this on too. Confirm the filing requirement with the county property appraiser.
Ask a Commercial Specialist
Call or text (786) 914-1017 or email sales@breakthrurealty.com. A licensed BreakThru Realty agent follows up within one business day.
Frequently Asked Questions
- Why is the property tax estimate higher than the seller's bill?
- Because the non-homestead assessment cap resets at sale. The seller's assessed value may be years behind the market; yours will be near the price. Budget for the reset.
- Can a commercial owner appeal the assessment?
- Yes, to the county value adjustment board after the TRIM notice, within the stated period, with evidence. Income-producing property is often appealed on its income. Confirm the procedure and deadline with the property appraiser.
- Do tenants pay the property tax?
- Under a triple-net lease, their proportionate share, as a pass-through billed with CAM and insurance. Under a gross lease the landlord pays it. Either way a reset after a sale is felt by someone, which is why buyers model it.
Commercial Services
Selling by Building Type
Calculators
Commercial Guides
- Gross, Modified Gross and Triple-Net Leases
- CAM Charges Explained
- Tenant Improvement Allowance
- Personal Guarantees
- From Letter of Intent to Lease
- Zoning and the Certificate of Use
- Phase I Environmental Site Assessment
- SBA 504 Loans for Owner-Users
- Opportunity Zones in Florida
- The Live Local Act for Owners
- Commercial Closing Costs in Florida
- Lease or Buy Your Business's Space?
- How Commercial Property Is Valued