Senior Property Tax Exemptions: What are They (and How You Can Save Big!)
Every dollar counts, especially when you’re living on a fixed income. That’s why senior discounts rank among the best perks of aging—aside from wisdom, of course!
Discounts on dining, movie tickets, travel, groceries, and property taxes are yours just for reaching a certain age.
Wait, property taxes?
That’s right, older homeowners could qualify for senior property tax exemptions that could significantly reduce their tax bills. Here’s what you need to know and how to determine if you qualify.
What is a senior property tax exemption?
Property taxes are complicated and make up a big chunk of homeownership costs. What’s worse is that the amount you owe annually can change.
Sometimes property taxes rise, which can be challenging for a senior citizen on a fixed income. So, many states help seniors by offering tax breaks through tax exemptions.
“Property tax exemptions reduce the taxable value of a property, which is used to calculate your property taxes,” says Will Wiggins, senior property tax consultant at North Texas Property Tax Services.
Eligibility requirements vary by state and sometimes by county.
Some states are more generous than others, offering additional discounts in the form of rebates and tax freezes. The latter “freezes” the valuation of your property, so the taxes don’t continue to rise.
These tax breaks might be available as a standalone product or can often be used with other tax exemptions.
How to qualify for a senior property tax exemption
Though the eligibility factors differ depending on where you live, age is the main qualifier for tax exemptions.
In general, homeowners must be 65 in most states that offer exemptions. However, Washington state rolls out exemptions for those 61 and older.
In addition, the homeowner must claim the home as a primary residence and meet specific household income requirements.
Property tax exemptions generally help those who need financial assistance, but some states offer exemptions on a tiered scale for higher-income homeowners.
How to get senior property tax exemptions
You’re not likely to get a reminder postcard on your 65th birthday, noting that you qualify for senior property tax exemptions or other tax breaks. So it’s up to you to find out what your state offers.
“You can check with your CPA to see if they’re aware of any incentives for seniors, but the best place to check is your tax assessor’s office website,” says CPA Romeo Razi, founder of TaxedRight.com
Alternatively, you can Google “senior property tax exemptions,” plus your state’s name, to get more information.
Examples of senior property tax breaks by state
To give you a general idea of what’s out there, here’s a list of six states’ senior property tax relief options.
Arizona: Seniors can get a nice tax break via the property valuation protection option, also known as the Senior Freeze Program.
“The program freezes the valuation of your property, so the taxes don’t continue to rise,” says Razi. “To qualify, you must be over 65 and be on a fixed income.”
Idaho: “In 2022, the state passed a law to help seniors and veterans with a property tax rebate,” says Razi.
The property tax reduction program could reduce your property taxes by $250 to $1,500. To get this break, you must be 65 and own and live in your home. Additionally, your total 2022 income (after deducting medical expenses) can’t exceed $33,870.
Florida: Homeowners 65 and older in the sunshine state may qualify for one or both homestead exemptions. One option is a homestead exemption of up to $50,000. The other tax exemption is equal to the property’s assessed value, with a just value of less than $250,000. Note: These aren’t for snowbirds who only use their homes as winter escapes or rentals. The property must be a permanent residence, and household income restrictions apply.
New York: Qualifying New Yorkers 65 and older could get up to 50% knocked off their property’s value assessment, resulting in a lower tax bill. Income levels vary depending on where you live.
Texas: The senior property tax exemption is available to Texas residents 65 or older.
“It is a $10,000 homestead exemption, and it’s in addition to the homestead exemption that residents of all ages can qualify for,” says Wiggins.
Texas also has a tax deferral—which allows property taxes to be deferred until the homeowner dies or sells the property—and a school tax ceiling or “tax freeze.”
“This means the school district taxes cannot increase while you own the property,” adds Wiggins.
Washington: You don’t have to wait until you’re 65 to snag this tax break. Homeowners 61 and older (or 57 years of age and the surviving spouse or domestic partner of a person who was an exemption participant at the time of their death) could qualify for a standard, full, or partial exemption of up to $60,000, depending on income.
And in addition to states, some cities offer tax exemptions, too.
For example, Philadelphia, PA, recently started a homestead exemption for homeowners of all ages that slashes the taxable portion of a property assessment by $80,000, when a home is claimed as a primary residence.