Homestead exemption can protect a portion of your property’s equity from certain creditors if you file for bankruptcy. In many U.S. states, it can also help you save on your property taxes. While some states provide both the property tax deduction and equity protection, other states only offer equity protection. Many states offer additional exemptions to seniors, veterans, and disabled homeowners. Each U.S. state sets its own amount for homestead exemption, and in some states, the amount can vary from county to county.
If the exemption allows for a portion of the value of your residence to be deducted from the property tax assessment, it will lower your property tax bill. For example, if the property tax assessor values your residence at $250,000 and you qualify for a $20,000 exemption, you would be assessed for property taxes on your home and land as if it was worth $230,000.
How do I qualify for a homestead exemption?
If you purchased a home that is your primary residence before December 31, 2020, you are entitled to apply for a homestead exemption on the house and land. If you’ve purchased before 2020 and forgot to apply, now is the time to do it. To be granted a homestead exemption, you must live in the home. The home must be considered your legal residence for all purposes.
Once you have applied and been granted a homestead exemption, your property will continue to receive the exemption each year until the home is sold or no longer used as your legal residence.
How do I find homestead exemption details for my county and apply for a homestead exemption?
You can access the homestead exemption form and specific information, including the filing deadline for your county, by contacting your county’s property tax office or searching online: [Your County] homestead exemption. Alternatively, you can visit your state’s Department of Revenue website for details on how to file a property tax exemption, or search online: [Your State] homestead exemption.
There is NO charge to submit the homestead exemption form, so be wary of any offer you receive in the mail to submit it on your behalf.
If your home was purchased in 2020, you should provide your tax preparer with a copy of the Closing Disclosure to see if you qualify for any tax savings on your personal income taxes.