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Reprieve From High Property Taxes: The Homestead Exemption

March, 2007

A house is our protection and shelter from the elements. Home is where you hang your hat, where your heart is.

Many seniors who own their homes have paid off their mortgage and own them out right. However, the end of mortgage payments does not mean the end of paying for your home. Each year, the property taxes have to be paid, often at an increase from the year before. Sadly, it is not uncommon for those on limited incomes to have a property tax bill so large that they are forced to choose between buying food and medicine or staying in their own homes.

But, there is a way older Ohioans may experience some relief on their property taxes: the Homestead Exemption. The Homestead Exemption is a statewide program that offers a reduction in real property and manufactured home taxes to qualifying homeowners in Ohio.

The exemption is a tax break for seniors and permanently disabled homeowners. It covers owners of single family homes, mobile and manufactured homes, condominiums and units in multiple-unit dwellings. It is also available to land contract and life estate ownerships.

The Homestead Exemption can reduce your property tax liability by 25 to 75 percent - up to $5,500 in some cases. The amount of your reduction will vary based on your household income, the value of your home and the tax rate of your community.

To be eligible for the Homestead Exemption:

• You must be at least 65 years old or totally and permanently disabled or a surviving spouse meeting certain conditions;
• You must own and occupy your home (your name is on the deed or life estate) as of January 1 in the year of application; and
• Your household income must be $26,200 or less for 2006. This includes pension, retirement, interest and social security incomes. If married, it also includes the income of your spouse. If you file an income tax return, use your federal adjusted gross income from your 1040 tax form.

You can apply at your county auditor's office beginning the first Monday in January until the first Monday in June. The first year you apply for the Homestead Exemption you may also apply for one prior year if you meet all eligibility requirements in that year.

The Homestead Exemption will be in effect as long as you live in your home and continue to qualify. Your county auditor will mail you a Continuing Homestead Exemption form annually. It is your responsibility to inform the auditor's office if your income has changed. The Homestead Exemption is not transferable. If you move, you may apply for your new home as long as you are the listed owner and live there as of January 1 of that year.

You can even keep the exemption if you transfer your home to your children, as long as you retain life estate.

The Homestead Exemption will not affect any other property tax deductions or rollbacks you may already be getting.

For an application and more information, contact your county auditor. Contact the County Auditors' Association of Ohio at (614) 228-2226 or log on to www.caao.org for a county-by-county listing.

Barbara E. Riley