Case Title: Furst v. Rebholz

Citation: 

Docket Number: SC2020-1479

State: florida

Court: Florida Supreme Court

Date: 2023-04-06T00:00:00Z

Document:
Supreme Court of Florida 
 
____________ 
 
No. SC2020-1479 
____________ 
 
BILL FURST, etc., et al.,  
Petitioners, 
 
vs. 
 
ROD REBHOLZ, etc., et al., 
Respondents. 
 
April 6, 2023 
 
MUÑIZ, C.J. 
This case is about the availability of the homestead tax 
exemption to a property owner who lives in one part of a residential 
structure but rents out another part for the exclusive use of a 
tenant.  See Furst v. Rebholz as Trustee of Rod Rebholz Revocable 
Trust, 302 So. 3d 423 (Fla. 2d DCA 2020).  We hold that the owner 
is not entitled to a homestead tax exemption on the rented portion, 
because that portion is not the owner’s residence.1 
 
 
1.  We have jurisdiction.  See art. V, § 3(b)(3), Fla. Const. 
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I. 
The Florida Constitution governs homestead property in 
several distinct ways: protecting it from forced sale by creditors; 
restricting its alienation and devise; exempting it from certain ad 
valorem taxes; and imposing a 3% cap on annual assessment 
increases (through the Save Our Homes amendment).  Art. X, § 4, 
Fla. Const.; art. VII, §§ 4(d)(1)a., 6(a), Fla. Const.  This case involves 
the homestead tax exemption and the Save Our Homes assessment 
increase cap.  Those provisions are intertwined, because the 3% 
assessment increase cap applies only to property that is entitled to 
a homestead tax exemption.  Art. VII, § 4(d), Fla. Const.; Zingale v. 
Powell, 885 So. 2d 277, 284-85 (Fla. 2004). 
The homestead tax exemption is set out in article VII, section 
6(a) of the state constitution.  In relevant part, it says: “Every 
person who has the legal or equitable title to real estate and 
maintains thereon the permanent residence of the owner, or 
another legally or naturally dependent upon the owner, shall be 
exempt from taxation thereon, [up to specified amounts].”  So there 
are two components to the homestead tax exemption: ownership 
and residency.  Ownership is not contested in this case.  Instead, 
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the parties’ dispute turns on the residency requirement and its 
application.  The question is how to determine the scope of a 
property owner’s residence for purposes of the homestead tax 
exemption. 
 
The property here is a two-story residential structure located 
in Sarasota.  In the decisions below, both the trial court and the 
district court characterized the structure as a “single family” home.  
For the tax years 2004 through 2013, county tax officials treated 
the entire structure as homestead property, based on owner Rod 
Rebholz’s initial homestead exemption application in 1996.  Rebholz 
owned the property and lived in a portion of the structure at all 
relevant times.  But it is undisputed that, for the entire time, 
Rebholz rented a portion of the structure to at least one tenant. 
 
Rebholz lived on the bottom floor, which consisted of a 
kitchen, living area, and bathroom.  The upper floor had a common 
laundry area and four individual rooms, each with its own living 
area and bathroom; some of the rooms had a kitchenette.  Each 
room was lockable from the outside.  The front door entry to the 
property had two doorbells, one for the bottom floor and the other 
for the top. 
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The record includes testimony from John Michael Beaumont, 
a tenant who rented one of the upstairs rooms without interruption 
from 1996 through the tax years at issue (2004 to 2013) and 
beyond.  Beaumont learned of the property by reading an 
advertisement in the newspaper.  A written rental agreement 
between Rebholz and Beaumont refers to the rate for Beaumont’s 
“unit.”  In his testimony, Beaumont called his unit “my place, my 
room, my apartment.”  Beaumont referred to Rebholz as “my 
landlord.”  Beaumont also spoke of “other tenants” and estimated 
that, since 1996, eight to ten such persons had intermittently lived 
in other rooms upstairs. 
 
In 2014, the Sarasota County property appraiser became 
aware that Rebholz might have received homestead benefits to 
which he was not entitled.  An investigation revealed the 
configuration of the property and the rental situation just 
described.  Eventually, the property appraiser revoked the 
homestead exemption on the 15% of the property that corresponded 
to Beaumont’s unit, leaving intact the homestead exemption on the 
remaining 85% of the property.  The property appraiser reasoned 
that, although Rebholz owned the entire structure and resided in 
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part of it, at least 15% of the property was not being used as 
Rebholz’s residence.2 
 
When a property appraiser determines that a person has 
improperly received a homestead tax exemption or Save Our Homes 
benefit, Florida law requires the property appraiser to impose the 
additional taxes that would have been due for up to the preceding 
ten years, plus a penalty and interest.  §§ 196.161(1)(b), 
193.155(10), Fla. Stat., (2014).3  In Rebholz’s case, the revocation of 
the homestead exemption as to 15% of the total property had the 
effect of removing the Save Our Homes benefit from that limited 
portion of Rebholz’s property.  The property appraiser therefore 
recalculated Rebholz’s taxes for tax years 2004 through 2013, 
applying to the non-homestead portion a 10% annual assessment 
increase cap (instead of the 3% Save Our Homes cap).  The result 
 
 
2.  The underlying complaint in this case and the subsequent 
court decisions did not address the 15% calculation or the 
methodology behind it, but rather the authority of the property 
appraiser to make this apportionment at all.  Our decision is 
similarly limited in scope.   
 
3.  In this opinion, we will cite the Florida Statutes as they 
existed in 2014.  Between 2003 and 2014, the statutory provisions 
cited in this opinion were not changed in ways material to this case. 
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was that Rebholz owed approximately $7,000 in back taxes, 
penalties, and interest.  He paid the tax lien but then sued the 
property appraiser, the tax collector, and the state Department of 
Revenue for a refund and a reinstatement of homestead status to 
the entire property.4 
After a bench trial, the circuit court entered judgment in 
Rebholz’s favor.  The court concluded that the entire structure 
should be considered Rebholz’s residence, and it held that “[m]erely 
sharing the residence with a tenant does not create a classification 
of property not exempted.”  The court continued: “Florida law does 
not authorize the Property Appraiser to deny a homeowner his 
constitutional homestead exemption for a room rented within his 
residence while he simultaneously maintains the property as his 
permanent residence.” 
 
On appeal, a divided panel of the Second District Court of 
Appeal affirmed in relevant part.  The district court echoed the trial 
 
 
4.  Rod Rebholz initiated this litigation but died on November 
20, 2015.  Donald Rebholz, as the successor trustee to the Rod 
Rebholz Revocable Trust, was substituted as the plaintiff and is the 
respondent in this case.   
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court, holding that “the property appraisers of this state are not 
authorized by law to carve up a homeowner’s permanent residence 
in order to remove the protection provided by the constitutional 
homestead exemption when that person rents a bedroom or any 
other space within their home.”  Furst, 302 So. 3d at 434.  The 
district court also held that Florida Administrative Code Rule 12D-
7.013(5) is an invalid exercise of delegated legislative authority.  Id. 
at 431.  That rule says that “[p]roperty used as a residence and also 
used by the owner as a place of business does not lose its 
homestead character.  The two uses should be separated with that 
portion used as a residence being granted the exemption and the 
remainder being taxed.” 
Judge Atkinson dissented in relevant part.  He reasoned that 
Rebholz had apportioned his property into separate residences, and 
that Rebholz’s own residence did not include the rented portion of 
the home.  Furst, 302 So. 3d at 434-35 (Atkinson, J., concurring in 
result only in part and dissenting in part).  Judge Atkinson 
summarized his view this way: “One cannot simultaneously reside 
in a residence and rent out that residence for another’s exclusive 
use as a residence.”  Id. at 434. 
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In response to a petition from the property appraiser and the 
Department of Revenue, we accepted jurisdiction to review the 
district court’s decision, which expressly affects property appraisers 
as a class of constitutional officers.  See art. V, § 3(b)(3), Fla. Const. 
II. 
 
The petitioners argue that the district court erred at the 
threshold by concluding that, for purposes of applying the 
homestead tax exemption, the entire structure was Rebholz’s 
residence.  We agree with the petitioners.  
The Legislature has implemented the constitutional homestead 
tax exemption through section 196.031, Florida Statutes (2014), 
which Rebholz has not challenged.  Subsection (1)(a) says that, 
when a property owner “in good faith” makes real property in this 
state his or a dependent’s “permanent residence,” the homestead 
tax exemption applies to “the residence and contiguous real 
property.”  § 196.031(1)(a), Fla. Stat. (2014).  The Legislature has 
defined the term “permanent residence” to mean “that place where a 
person has his or her true, fixed, and permanent home and 
principal establishment to which, whenever absent, he or she has 
the intention of returning.”  § 196.012(17), Fla. Stat. (2014).  Our 
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Court has observed that “most determinations regarding whether a 
permanent residence is being maintained on Florida property will 
involve some level of factual inquiry regarding the actual use of the 
residential property in question.”  Garcia v. Andonie, 101 So. 3d 
339, 347 (Fla. 2012) (emphasis added).  
 
A review of section 196.011, Florida Statutes (2014), confirms 
that residency is a use-based requirement.  Subsection (1)(a) 
establishes an application requirement for tax exemptions that are 
based on property’s “ownership and use.”  Subsection (9)(a) then 
shows that this category includes homestead exemptions.  
Specifically, subsection (9)(a) requires an updated application or 
notice “when the applicant for homestead exemption ceases to use 
the property as his or her homestead.” 
 
Now consider the part of the structure that Rebholz rented to 
Beaumont throughout the tax years at issue—the 15% that the 
property appraiser has designated as non-homestead property.  Did 
Rebholz use that property as his residence?  Surely not.  The record 
leaves no doubt that Rebholz gave exclusive use of that portion to 
Beaumont, subject to Beaumont’s compliance with the terms of 
their rental agreement.  Contrary to the district court’s 
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characterization, the property appraiser did not “divide” or “carve 
up” Rebholz’s residence; instead, the property appraiser applied the 
statutory scheme to discern the scope of Rebholz’s residence in the 
first instance.  The disputed portion of the property was used as 
Beaumont’s residence, not as Rebholz’s.  Cf. Smith v. Guckenheimer, 
27 So. 900, 914 (Fla. 1900) (“How, then, are the exempted residence 
and business house to be recognized and distinguished?  Only by 
their actual use as such by the party asserting the exemption 
thereof.”).5 
 
But the question remains: does Florida law allow the property 
appraiser to recognize this apportionment of Rebholz’s property for 
homestead tax exemption purposes?6  The district court said that 
the answer is no.  That conclusion seemed driven by two things: 
 
 
5.  Before the adoption of our state’s 1968 constitution, the 
homestead tax exemption for urban homesteads applied to the 
owner’s “residence and business house.”  Art. IX, § 1, Fla. Const. 
(1868).  The 1968 constitution removed homestead protection for 
the owner’s “business house.” 
 
6.  We recognize that cases involving homestead property’s 
protection from forced sale may involve considerations (e.g., the 
physical divisibility of a given property) different from those present 
in the tax exemption context.  Readers of this decision must keep 
that distinction in mind. 
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first, the district court’s characterization of the property as a 
“single-family residential home,” Furst, 302 So. 3d at 434 n.5; and 
second, the district court’s belief that no provision of Florida law 
explicitly authorized the apportionment.  In the district court’s view, 
the property appraiser was asking the court to “read into the 
[governing] statute provisions that are not there.”  Id. at 429.  We 
believe that the district court’s holding on this question is wrong.   
 
The most explicit authority for the property appraiser to 
apportion the property is found in section 196.031(4), Florida 
Statutes (2014).  That provision says that the homestead exemption 
can apply to “the portion of property” that is classified and assessed 
as owner-occupied residential property.  The district court’s 
decision does not discuss this section, even though the property 
appraiser invoked it in the proceedings below. 
 
More fundamentally, the property appraiser’s authority is 
derived from his obligation to implement a constitutional and 
statutory scheme that makes residency a use-based requirement.  
Rebholz and the district court would allow a property’s structure—
and the labels used to describe the property—to dictate the 
application of the homestead tax exemption.  The result would be to 
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make arbitrary distinctions between functionally similar 
homeowners and properties, without any constitutional or statutory 
basis for doing so. 
 
In this case, for example, the label “single-family residence” 
does not reflect the true design and use of Rebholz’s property.  That 
property was effectively a boarding house, a part of which Rebholz 
lived in and used as his own residence.  To limit the reach of its 
decision, the district court purported to distinguish Rebholz’s 
property from “a multifamily apartment building of individual 
autonomous units.”  Furst, 302 So. 3d at 434 n.5.  But assuming 
the property owner were to live in one of those apartment units, we 
fail to see a meaningful difference between that hypothetical 
property and Rebholz’s.  Beaumont—Rebholz’s tenant—himself 
called his living area an apartment.  The point is not to quibble over 
labels.  Under the constitutional and statutory scheme, how an 
owner uses a property—not its physical structure or what it is 
called—dictates the availability of the homestead tax exemption. 
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III. 
 
We have considered Rebholz’s arguments in support of the 
district court’s decision, and we find them unpersuasive.   
The parties and the courts below wrestled with whether and 
how section 196.012(13), Florida Statutes (2014), applies in this 
case.  That provision defines the term “real estate used and owned 
as a homestead” for purposes of chapter 196.  It says:   
(13) “Real estate used and owned as a homestead” means 
real property to the extent provided in s. 6(a), Art. VII of 
the State Constitution, but less any portion thereof used 
for commercial purposes . . . .  Property rented for more 
than 6 months is presumed to be used for commercial 
purposes. 
 
The trial court held that, to the extent the property appraiser had 
applied this provision in Rebholz’s case, it was unconstitutional. 
The district court reversed on that point, concluding that this 
definitional provision does not apply to Rebholz at all and therefore 
should not have been considered by the trial court.  The district 
court noted that chapter 196 uses the defined term only in 
connection with 100% homestead exemptions for property owned 
and used by disabled veterans and other disabled persons.  Those 
exemptions are codified in distinct provisions that are separate from 
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the generic homestead provisions applicable to Rebholz.  Furst, 302 
So. 3d at 429-30; §§ 196.091, 196.101, Fla. Stat. (2014). 
We agree with the district court that this case does not put 
directly at issue section 196.012(13)’s definition of “real estate used 
and owned as a homestead.”  As the district court explained, 
Chapter 196 uses that term only in provisions that have not been 
applied to Rebholz.  The trial court erred by taking up the 
“constitutionality” of a defined term embedded in those provisions. 
 
But in his arguments to our Court, Rebholz now attempts to 
use section 196.012(13) to his advantage.  He contrasts that 
provision with section 192.001(8), Florida Statutes (2014), which 
gives the following definition of the term “homestead”: “that 
property described in s. 6(a), Art. VII of the State Constitution.”  
Rebholz argues that reading sections 196.012(13) and 192.001(8) 
together shows that homestead property can be used for 
commercial purposes.  Otherwise, says Rebholz, there would be no 
need for section 196.012(13) explicitly to subtract “any portion 
thereof used for commercial purposes” from “real property to the 
extent provided in s. 6(a), Art. VII of the State Constitution.” 
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It is true that, to the extent it is part of the overall statutory 
scheme governing homestead tax exemptions, section 196.012(13) 
could inform the meaning of the provisions that are directly 
applicable to Rebholz.  But we do not think that section 
196.012(13) helps Rebholz here.  Nothing in that provision 
undermines our analysis showing that, under the constitution and 
section 196.031(1)(a), the owner or a dependent must himself use 
property as his residence for that property to qualify for the 
homestead exemption.  Rebholz has perhaps offered an 
interpretation of section 196.012(13) suggesting that homestead 
property could be used both as a residence and for commercial 
purposes.  (The common areas shared by Rebholz and his tenants 
might be considered an example of such dual use.)  We need not 
decide if Rebholz is right about that, because the record leaves no 
doubt that Rebholz did not use the disputed 15% of his property as 
his residence at all. 
 
Rebholz also seeks support from section 196.061, Florida 
Statutes (2014).  There, the Legislature says that a homestead is 
deemed abandoned upon “[t]he rental of all or substantially all of a 
dwelling previously claimed to be a homestead for tax purposes.”  
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That provision goes on to say that the abandonment “continues 
until the dwelling is physically occupied by the owner.”  Rebholz 
argues that, since it is undisputed that he did not rent out the 
entire structure, the rental of a single room should not affect his 
homestead exemption. 
We think that section 196.061 has no bearing on this case.  
The property appraiser does not claim that Rebholz “abandoned” or 
was absent from his homestead.  It is undisputed that Rebholz at 
all relevant times resided in a portion of the property, and the 
property appraiser has left intact the homestead exemption as to 
that portion.  Section 196.061 simply does not speak to the 
circumstances here. 
Finally, Rebholz invokes an aspect of section 196.031(4) that 
we have not yet discussed.  In full, that provision reads: “The 
[homestead] exemption provided in this section applies only to those 
parcels classified and assessed as owner-occupied residential 
property or only to the portion of property so classified and 
assessed.”  Rebholz notes the undisputed fact that, throughout the 
tax years at issue, the property appraiser classified and assessed 
Rebholz’s property entirely as owner-occupied residential property.  
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Rebholz says this means that he is entitled to a homestead 
exemption on the entire structure.  We disagree, for a couple of 
reasons. 
First, section 196.031(4) on its face establishes a necessary 
condition for the availability of the homestead exemption, but the 
statute does not say that the classification alone is sufficient.  More 
importantly, by requiring property appraisers to assess back taxes 
and penalties upon discovering that property has improperly 
received a homestead tax exemption or Save Our Homes benefit, 
sections 196.161(1)(b) and 193.155(10) show that mistaken 
classifications do not control and can be corrected.  Rebholz’s 
interpretation of section 196.031(4) would render those remedial 
provisions ineffective. 
IV. 
 
We conclude with a word about the scope of our decision 
today.  Unlike the district court in its opinion below, we do not 
equate Rebholz with the “countless Florida citizens” who are 
“resid[ing] within their permanent residences” while “working from 
home.”  Furst, 302 So. 3d at 434.  The phrase “working from home” 
speaks to activity occurring within property already found to be the 
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owner’s residence.  This case is about defining the scope of the 
residence in the first instance.  Here, Rebholz gave a tenant 
exclusive use of a portion of Rebholz’s property, reserving to himself 
only the access rights of a landlord.  That portion of the property 
was not Rebholz’s residence. 
 
We quash the decision of the Second District (including its 
holding that Rule 12D-7.013(5) is invalid) to the extent it is 
inconsistent with our decision here.  And we remand the cause for 
further proceedings consistent with this opinion. 
 
It is so ordered. 
CANADY, LABARGA, COURIEL, GROSSHANS, and FRANCIS, JJ., 
concur. 
 
NOT FINAL UNTIL TIME EXPIRES TO FILE REHEARING MOTION 
AND, IF FILED, DETERMINED. 
 
Application for Review of the Decision of the District Court of Appeal 
Class of Constitutional Officers/Direct Conflict of Decisions 
 
 
Second District – Case No. 2D18-3323 
 
 
(Sarasota County) 
 
Jason A. Lessinger, J. Geoffrey Pflugner, Anthony J. Manganiello, 
and Patrick Seidensticker of Icard, Merrill, Cullis, Timm, Furen & 
Ginsburg, P.A., Sarasota, Florida, 
 
 
for Petitioner Bill Furst 
 
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Ashley Moody, Attorney General, and Timothy E. Dennis, Chief 
Assistant Attorney General, Tallahassee, Florida, 
 
 
for Petitioner State of Florida, Department of Revenue 
 
Sherri L. Johnson of Johnson Legal of Florida, P.L., Sarasota, 
Florida, 
 
 
for Respondent 
 
John C. Dent, Jr. and Jennifer A. McClain of Dent & McClain, 
Chartered, Sarasota, Florida, 
 
for Amici Curiae Ayesha Solomon, as Property Appraiser of 
Alachua County, Florida, and Scott P. Russell, as Property 
Appraiser of Monroe County, Florida 
 
Loren E. Levy and Sydney E. Rodkey of The Levy Law Firm, 
Tallahassee, Florida, 
 
for Amicus Curiae Property Appraisers’ Association of Florida, 
Inc. 
 
Geraldine Bonzon-Keenan, Miami-Dade County Attorney, Jorge 
Martinez-Esteve and Daija Lifshitz, Assistant County Attorneys, 
Miami, Florida, 
 
for Amicus Curiae Pedro J. Garcia, as Property Appraiser for 
Miami-Dade County, Florida