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Property Tax Exemptions Overview


If you own property, then you must pay property taxes or face the legal consequences. However, there are certain situations in which you may be legally eligible for property tax exemptions. States vary on the requirements for exemptions, so check with your local laws to find out more. There are a number of property tax relief programs available. Certain types of property are exempt or partially exempt from taxes, and some classes of persons may also qualify for exemptions from some or all of their property tax obligations. Exemptions usually involve reducing the maximum assessed value of a particular property, not reducing your tax rate. Not all exemptions are available in every state, but some possible exemptions include: Senior citizens exemption: Most states offer exemptions to property owners over a certain age, usually starting between age 50 and age 65. Often your income must also be below a certain limit, which may be tiered, so that owners making less receive a greater reduction in taxes paid. This exemption is usually only available for a primary residence. Disabled persons exemption: This exemption usually applies to disabled persons of any age. Restrictions on income and residency are similar to the senior citizens exemption. Home improvement exemption: If you make substantial improvements to your primary residence, you may receive an exemption from taxes on the value of the improvements. It is usually available for a set number of years after you've made the improvements. Historical restoration exemption: If you are restoring an historically significant property, you may be exempt from some or all of the property taxes during restoration. Circuit breaker: Circuit breaker programs are intended to protect low-income individuals, regardless of age or disability, from rising property taxes. They are not true exemptions in that they don't necessarily reduce or freeze valuations. Rather, these programs rebate or credit the amount of property taxes that exceed a certain percentage of a family's income. To receive a property tax exemption or enroll in a circuit breaker program, you must usually file the appropriate application by a certain deadline. Some localities may require annual applications while others may only require periodic affirmations that you still meet income and residence requirements, as applicable. Laws vary widely, so be sure to check your state and county regulations for information on the types of exemptions available and qualification criteria.

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