Property taxes in the US disproportionately affect seniors: 16 states offer relief

In the US, 16 states exempt seniors from property tax, and almost every state offers some benefits, Realtor.com reports, writes UNN.

DetailsRising property tax rates have affected homeowners across the country. But no one has been hit harder by this growing burden than seniors, many of whom are struggling to cope with the rising costs associated with aging in place while living on a fixed income, the publication writes.

Even if homeowners have hundreds of thousands of dollars in equity, it can come with a hidden housing tax that disproportionately affects seniors, and maintaining it means keeping up with rising tax bills, the publication notes.

To ease the burden, 16 states and the District of Columbia offer property tax exemptions for eligible seniors. Another 18 states provide tax credits, five have implemented property tax freezes to stabilize annual costs, and six offer deferral programs. However, as noted, many of these measures are not keeping pace with rapidly rising housing prices, providing relatively little relief.

Currently, seven more states are considering new laws designed to protect seniors from being taxed out of homes they have paid for for decades.

There are several forms of tax relief, the most common of which are exemptions, freezes, tax credits, and deferral programs. All of them aim to reduce the tax burden but work differently.

While many states offer targeted benefits for seniors and ease their tax burden, qualifying for this benefit is not always as simple as reaching a certain age. Many laws also include income requirements for property tax benefits, deductions, and freezes. Requirements vary from state to state, and sometimes from year to year.

Navigating the intricacies of property tax benefits can be challenging, but it can be worth the effort. According to a recent Realtor.com report, up to 40.5% of property owners may be overpaying on property taxes.

States offering property tax exemptions for seniors:

• Alabama: exempts seniors from state-levied property tax; county taxes may still apply;
• Alaska: exempts the first $150,000 of assessed home value for homeowners aged 65 and older;
• Colorado: exempts 50% of the first $200,000 of a senior’s primary residence value;
• District of Columbia: halves property tax for eligible seniors;
• Florida: counties and cities may provide benefits of up to $50,000 for seniors with incomes under $35,000;
• Georgia: provides a $4,000 property tax benefit for eligible seniors;
• Indiana: reduces the assessed value of an eligible senior’s home by $14,000;
• Iowa: exempts $6,500 of taxable value from property tax for homeowners aged 65 and older;
• Kentucky: exempts $49,100 of assessed value from property tax for eligible homeowners aged 65 and older;
• Mississippi: exempts $7,500 of assessed value from property tax for homeowners aged 65 and older;
• Nebraska: offers a property tax reduction for seniors on their primary residence;
• New York: local authorities may exempt up to 50% of assessed value from property tax for seniors with incomes under $58,000. Seniors may also qualify for an enhanced STAR tax credit;
• North Carolina: exempts $25,000 of assessed value or 50% of the home’s assessed value, whichever is greater, for eligible homes;
• Ohio: exempts $26,200 of assessed value from property tax for eligible seniors;
• South Carolina: exempts the first $50,000 of fair market value from tax for homeowners aged 65 and older;
• Texas: mandates school districts to provide an additional $10,000 property tax benefit for seniors. Local tax authorities may provide an additional tax benefit of at least $3,000;
• Washington: offers three levels of property tax relief depending on the combined disposable income of seniors.

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