If you own a home or are planning to do so in the future, then you are going to want to know about the Homestead Exemption.
Considering you meet the qualification requirements, a homestead exemption can save you hundreds of dollars a year on your property taxes.
What is a Homestead Exemption?
A Homestead Exemption is a tax exemption offered by some states to help offset the burden of property taxes.
According to Smart Asset, forty-six states currently offer a homestead exemption. Some states either exempt a percentage of a home’s value or a set amount from your property taxes. Georgia and Florida are currently both states that offer a homestead exemption.
Who Qualifies for a Homestead Exemption?
In general, any person who owns a home and pays taxes can qualify for the homestead exemption if the following criteria is met.
1. You have owned the home since January 1st of the taxable year.
First, a home qualifies for the exemption only if the homeowner lived in the home as of January 1st of that year. If you moved into a home on May 5, 2019, then you can’t claim homestead exemption for 2019. However, you can claim exemption for 2020. If you do move into a home after January 1st, you can still file early for the homestead exemption for the following year.
2. The home is your primary residence.
For a home to qualify for the homestead exemption, it must be your primary residence. This means you must actually live in the home and consider it your legal residence.
There are some exceptions to this rule for people who cannot occupy their home due to health reasons. It is important to check with your state or county tax assessor's office to find out their exact rules and restrictions.
3. You file before the deadline.
Each state and county have their own deadlines for the homestead exemption. It is important to do your research and find out these dates early. Otherwise, you could miss out on the opportunity to qualify for the exemption.
The deadline for the Homestead Exemption is the same day as property tax deadlines for your county or state. If you miss the deadline, then you will lose the exemption for that year.
For Georgia residents, the deadline this year for all counties is April 1st, 2020. The deadline to file for Florida residents is March 1st, 2020. The best place to find instructions for filing for your exemption will be from your county tax assessor’s office.
How much is the homestead exemption?
As mentioned above, the homestead exemption could save you hundreds of dollars on your property taxes. However, this amount varies by county and state.
According to the Georgia Department of Revenue, "the home of each resident of Georgia that is actually occupied and used as the primary residence by the owner may be granted a $2,000 exemption".
In Georgia and in other states, individuals such as disabled veterans, senior citizens older than 65 years of age, and surviving spouses of members of the armed forces can qualify for even higher exemptions — up to $60,000 in some scenarios.
Again, it is recommended to check with your city (if applicable), county and state to learn the different options available to you. There may be higher or more beneficial exemptions depending the route you take to file.
Of course, you can also always reach out to neighbors or other property owners in your area using AddressScoop.com. Contacting other homeowners in your area about their experience with homestead exemptions can help you get a good understanding of what is involved and how much you can save.
Where Should A Homeowner File For Homestead Exemption?
Once you’ve met the criteria above, you can file for homestead exemption with your state or county’s tax office.
Whether you choose to file for the exemption from your state or county, it is probably a good idea to check with your local tax commissioner or tax assessor’s office for all official guidelines and benefits.
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Conclusion
The Homestead Exemption offers a significant advantage to homeowners by decreasing the assessed value of their homestead property. This reduction results in lowered county taxes and school district taxes, providing tangible financial relief to property owners. Understanding the correlation between the fair market value of your property and the assessed value post-homestead exemption can be a game-changer. It's therefore beneficial to converse with a property appraiser to better understand this relationship and ensure you are maximizing the exemption benefits.
Completing the Homestead Exemption Application is a process worth your time and effort. An additional exemption is available for certain categories of homeowners, such as surviving spouses or those with specific disabilities, which makes the procedure even more advantageous. The savings from these exemptions can be channeled into other important areas of your life or simply improve your overall financial stability.
School district taxes often form a considerable part of the property taxes. With the homestead exemption, homeowners can expect to see a reduction in these school taxes, thereby lowering the overall tax burden. It is important for every property owner to remember that they have a right to the homestead exemption as long as they meet the eligibility criteria. Utilizing the homestead exemption can make homeownership a more affordable venture, enhancing the joy and financial benefits that come with owning a home.
