How to Claim Your Senior Property Tax Exemption

April 15, 2020 - 6 min read

Take advantage of tax breaks as a senior

When it comes to property taxes, retirees often find themselves in a unique position. While home values continue to increase — and with them, property taxes — retirees’ incomes do not.

Several states have taken steps to ease this particular tax burden for seniors.

Here’s how senior property tax exemptions work, and how to know if you qualify for one.

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What are senior property tax exemptions?

A senior property tax exemption reduces the amount seniors have to pay in taxes on properties they own.

Property taxes are quite possibly the most widely unpopular taxes in the U.S. And for retirees, they create a unique problem — as property taxes increase over time but incomes may not.

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States have responded to this issue by enacting tax relief policies for certain homeowners, including senior citizens.

But states aren’t always proactive in getting seniors the help they need.

The state, county or city agency that collects your property taxes usually doesn’t tell you that you qualify for an exemption. You have to find out for yourself whether you qualify.

In fact, the state, county or city agency that collects your property taxes usually doesn’t tell you that you qualify for an exemption.

Instead, you yourself have to figure out whether you’re eligible, and then request the tax deduction you qualify for.

Here’s how to do that.

How property tax exemptions work

The first thing to know is that property tax exemptions don’t have any effect on the tax rate. And, they typically don’t come off your tax bill.

Instead, they usually reduce the value of your home that’s subject to taxation.

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Some areas offer a certain percentage off home values, while others offer dollar amounts.

Savings from exemptions will vary widely depending on where you live, the value of your home, and what you qualify for.

You will need to find out the property exemptions that are offered in your area and then apply for them.

How to qualify for a senior tax exemption

Property tax rules vary considerably from state to state. Seniors who meet state guidelines can take advantage of an exemption. For example, most states include these two rules to qualify:

  • You must meet the minimum age for a senior property tax exemption
  • The person claiming the exemption must live in the home as their primary residence

The minimum age requirement for senior property tax exemptions is generally between the ages of 61 to 65.

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While many states like New York, Texas and Massachusetts require seniors be 65 or older, there are other states such as Washington where the age is only 61.

In New Hampshire, although you’ll need to be 65 or older, you’ll also benefit from an increased exemption as you age.

Many locations set income requirements as well. Earning too much may disqualify you, or the amount of your exemption will be reduced.

Most states have an official government website dedicated to taxes, revenue, or finance that will list the local rules for senior property tax exemptions.

A Google search for “senior property tax exemptions [state]" should turn up yours.

How to claim your senior property tax relief

It’s important to file for your senior tax exemption by the deadline imposed by your state. Each state has different deadlines.

Most states have websites where you can find the deadlines for filing, along with the necessary forms and instructions.

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Most states have websites where you can find the deadlines for filing, along with the necessary forms and instructions.

Applications for property tax exemptions are typically filed with your local county tax office.

While most states offer basic exemptions for those that qualify, your county may offer more beneficial exemptions.

Whether you are filing for exemptions offered by the state or county, you should contact the tax commissioner or the tax assessor’s office in your county for more information or clarification about qualifying for tax exemptions.

Examples of senior property tax exemptions by state

While most states offer some form of property tax exemption for seniors, some are more kind than others.

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Wyoming and Nevada bear the lowest overall state and local tax burden in the U.S.

Neither of these two states has any state income taxes. You can cash in your retirement plans and collect your social security checks without having to worry about a big state tax bill.

New York’s senior exemption is also pretty generous. It’s calculated at 50 percent of your home’s appraised value, meaning you’re only paying half the usual taxes for your property.

You must be age 65 or older and have an annual income of no more than $29,000 as of 2019.

Other states and cities aren’t so friendly.

For senior homeowners in Boston, for example, exemptions are much smaller.

Boston, MA offers $1,500, and you can’t claim it in 2020 if it makes your tax bill less than what it was in 2019. And, you have to turn 65 by July 1st.

Boston retirees also must have lived in the state of Massachusetts for 10 years, or have owned the property for five years.

In Washington, you may claim an exemption if you were at least 61 years old in the previous year and have a household income of less than $35,000.

Depending on your income level, this exemption can be standard, partial or full.

A full exemption in Washington means that you pay no tax on the first $60,000 or 60 percent of assessed value, whichever is greater.

Again, you’ll have to look up your state’s rules to find out whether you qualify, and for how much.

Property tax exemptions FAQs

What are the different types of property tax exemptions?

For those who qualify, tax exemptions generally come in four different categories:

- Seniors: You may be eligible if you have a limited income and you are at or above a certain age
- People with disabilities: You may get an exemption if you have limited income and a disability keeps you from working
- Veterans: Armed forces vets with a total disability and veterans with service-connected disability ratings of 80% or may get an exemption
- Homestead: most states have a homestead property tax exemption that allows you to protect a certain amount of the value of your primary property from taxes

Are real estate taxes the same as property taxes? 

Yes, real estate tax and property tax are considered the same. The Internal Revenue Service uses the term “real estate tax.” However, most homeowners call it “property tax.”

What's a tax exemption vs. tax deduction? 

These two are similar, but not synonymous. Much like a deduction, a tax exemption reduces your taxable income. However, exemptions excuse parts of your income from your taxable income and depend on your filing status and how many dependents you claim.

What is a property tax deferral?

A deferral means you can delay paying property taxes, as long as you meet the age and income guidelines. The property tax then becomes a lien on your house, which gathers interest as long as it goes unpaid.

The bottom line on property tax relief for retirees

No one enjoys paying one penny more than required when it comes to paying taxes.

When it comes to property taxes, you could be paying too much if you don’t know how to qualify for an exemption.

While it’s true that taxes are almost always certain, fortunately for retirees, many states provide some sort of tax relief when it comes to property taxes.

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Craig Berry
Authored By: Craig Berry
The Mortgage Reports contributor
With over 20 years in mortgage banking, Craig Berry has helped thousands achieve their homeownership goals.