Property tax is one of the largest fixed costs for retirees who own their home, and it tends to rise even when income does not. Nearly every state offers some form of relief to older homeowners, but most programs require you to apply, and many eligible seniors never do.
Homestead exemptions
A homestead exemption removes part of your home's assessed value from taxation. Many states offer a basic exemption to all owner-occupants and a larger one for residents over a certain age, often 65. Some states add extra exemptions for veterans, people with disabilities or low-income homeowners. Exemptions usually apply only to your primary residence.
Assessment freezes and caps
Several states let seniors freeze the assessed value of their home, so the tax base does not rise with the market, or cap the annual increase in taxable value. These programs often have income limits and must be renewed periodically.
Circuit breakers and rebates
A circuit breaker program refunds part of your property tax when it exceeds a set share of your income. Some states extend similar credits to renters, on the theory that landlords pass property tax through in rent. These credits are often claimed on the state income tax return.
Deferral programs
Tax deferral lets qualifying seniors postpone paying property tax until the home is sold or the estate is settled. The deferred tax usually accrues interest and becomes a lien on the property, so it is best used as a last resort, but it can keep a house-rich, cash-poor retiree in their home.
How to apply
Contact your county assessor or tax collector, or look on their website for senior exemption forms. Deadlines often fall early in the year, and missing one can cost a full year of savings. Bring proof of age, ownership, residency and, where required, income. If your home is held in a trust, ask whether the exemption still applies.
