Property tax relief for older homeowners

Property tax can go up even when your income does not, and that weighs more once you are retired. The good news is that many states have programs for older homeowners. This guide explains the four most common forms of relief, with real examples from several states’ official pages, and points you to the verified programs in yours. It does not replace your county office: the rules change by state and relief has to be applied for.

More school tax exemption in Texas starting at 65

$60,000¹

The minimum age for Washington's senior exemption

61³

The simple interest a deferral accrues in Washington

5%³

Four forms of relief

Each state builds its help its own way. The programs in this guide fall into four forms. Knowing which is which helps you ask the right questions at your county office. Our guide Property tax explained explains how property taxproperty taxProperty tax is the tax the county, city, school district and other local bodies charge real property owners every year to pay for schools, police, fire and other public services. It is computed on the value the assessor's office assigns to your home, at each body's rate, minus the exemptions you qualify for, such as the primary-residence exemption in many states. If you have a mortgage you normally pay it month by month inside your payment, through the escrow account. It is generally deductible on your federal return if you itemize.See the full definitionClose is calculated.

1. The exemption: lowers the value you pay on. An amount is taken off your home’s assessed valueassessed valueAssessed value, or assessment, is the value the local government's assessor gives your property to calculate property tax. It is only for taxes: it is not the appraisal a lender orders for your mortgage. The assessor first estimates market value, usually by comparing your home with similar homes that sold recently. In some places the assessment equals full market value, and in others it is a fraction of it. The assessor does not decide how much you pay: that depends on the rates set by the county, the city and the school district.See the full definitionClose before the tax is calculated. In Texas, for example, school districts must give an additional $60,000 exemption on the main home of people 65 or older or with a disability, and each taxing unit can add a local exemption for them of at least $3,000.¹ In Illinois, the senior exemption lowers the equalized assessed value by up to $8,000 in Cook County and its neighbors, and up to $5,000 elsewhere.²

2. The freeze: the assessment does not rise. Your home’s value stays fixed for tax purposes, even if prices go up in your neighborhood. In Illinois, the freeze for low-income seniors keeps the equalized assessed value from rising as long as you keep qualifying, and you apply every year with Form PTAX-340.² In Arizona, the valuation protection option fixes the value of your primary residence for three years that can be renewed; you apply with Form 82104 through the county assessor.⁵ A freeze fixes the value; ask your county how your tax is calculated on that value.

3. The deferral: you pay later. You do not pay now, but the debt stays on the house. In Illinois it works like a loan against the property’s value: a lienlienA lien is a legal right a creditor holds in your property to make sure you repay a debt. It usually prevents the property from being sold until the debt is paid, and if you do not pay, the creditor may be able to take the property. Your mortgage is a lien on your home: when you pay it off, the lien is released and that shows up in your county's property records. There are other kinds, such as a federal tax lien, which is the government's legal claim against all your property when you do not pay a tax debt.See the full definitionClose is recorded and the state recovers the deferred amount with interest when the home is sold or transferred.² In Washington, the deferred amount accrues 5% simple interest and must be repaid when you sell, when the owner dies or when the home is no longer their primary residenceprincipal residenceYour principal residence is the home where you live permanently and spend most of the year. According to FHA, a person can have only one principal residence at a time. Lenders tell it apart from a second home, which you occupy in addition to your principal residence but for less than most of the year, and from an investment property, which you own but do not live in. Fannie Mae buys loans on all three, but it applies a loan-level price adjustment (LLPA) to loans on investment properties.See the full definitionClose.³

4. The credit or rebate: you get part of it back. You pay the tax and the state gives back part of it based on your income. In Missouri, the credit known as the “circuit breaker” can reach $1,100 for owners and $750 for renters, depending on what you paid and your household income.⁶ In Pennsylvania, the rebate can be up to $1,000 for people 65 or older, widows and widowers 50 or older and people with disabilities 18 or older, with household income of $48,110 or less.⁷

Exemption, freeze or deferral

You pay less

Exemption

• An amount is taken off the assessment before the tax is calculated
• Example: $60,000 more off school tax in Texas from age 65
• Nothing is repaid: it is a discount

The assessment stays put

Freeze

• The home's value stays fixed for tax purposes while you qualify
• Example: Illinois, applied for every year with Form PTAX-340
• Ask how your tax is calculated on the frozen value

You pay later

Deferral

• You do not pay now; the debt stays on the house
• Example: in Washington it accrues 5% simple interest
• Repaid when you sell, when the owner dies or when you stop living there

Many states combine several forms; ask about all of them at your county office.

Who qualifies: age, income and main home

There is no national rule. Each program sets its own age, income limit and conditions. These official examples show how different they can be:

• Age. In Texas and Illinois the programs in this guide start at 65.¹² In Washington, the exemption starts at 61.³ In Pennsylvania, the rebate includes widows and widowers from 50 and people with disabilities from 18.⁷
• Income. Many programs have a limit. In Washington it depends on your county’s threshold.³ In Maine, under current law, the state deferral requires income under $80,000 and liquid assets under $100,000, or $150,000 for all owners together if the home has several owners.⁴
• Main home. Nearly all the programs are for the home you live in. In Washington, for example, the deferral must be repaid if the home stops being your primary residence.³
• Disability. Several programs also include people with disabilities, with or without an age limit. In Maine, the deferral includes people who cannot work because of a disability.⁴

How to apply, step by step

From the first call to the discount on your bill

1. 1. Check your bill

   Today

   See which exemptions you already have; if you do not see the main-home one, start there.

2. 2. Call your county assessor's office

   This week

   Ask about the senior exemption, freeze, deferral and credit.⁵

3. 3. Gather your proof

   Before the deadline

   Your age, that you live in the home and last year's income.³

4. 4. File the form

   Within the program's deadline

   Some are filed once and others every year, like Illinois's freeze.²

5. 5. Check the next bill

   When it arrives

   Make sure the relief shows up; if not, call and ask why.

6. 6. Repeat when needed

   Every year

   Mark the program's deadline on your calendar so you do not lose it.²

If you pay the tax through your mortgage, the relief lowers what your servicer pays each year from your escrowescrow accountAn escrow account is an account set up by your mortgage lender to pay certain property-related expenses on your behalf, mainly property taxes and homeowners insurance. The money comes from a portion of your monthly mortgage payment: each month you contribute a share and the loan servicer pays the bills when they come due. That is why your payment is higher than principal and interest alone, and why it can change when taxes or the insurance premium go up. In some states the word also names the period between the offer and the closing.See the full definitionClose account. Our guide Why did my escrow payment go up? explains how and when your payment is adjusted. And if you think your home’s assessment is too high, you can appeal it in addition to asking for relief: our guide How to appeal your property assessment explains the assessment appealproperty tax appealA property tax appeal is the formal process to ask that the value the local government gave your property be changed, if you think it is too high or has errors. Each state calls it something different: in Texas it is a protest to the appraisal review board, and in New York it is a grievance with the municipality. Often you can first talk informally with the assessor's office. There are strict deadlines and it is up to you to bring evidence, such as sales of similar homes. The appeal reviews the value, not the tax rate.See the full definitionClose.

Example with real numbers

A 70-year-old homeowner in Illinois, outside Cook County

An example in words, not a real case, of how programs can add up.

Her senior homestead exemption

Lowers the equalized assessed value by up to $5,000 outside the Cook area

If her income is under the limit

She can apply for the freeze, which keeps the equalized assessed value from rising

What she has to do every year

File Form PTAX-340 for the freeze

If that is still not enough

She can ask about the deferral, which puts a lien on the house

What she decides

Apply for the exemption and the freeze, and talk with her family before deferring

The rules in the example come from the Illinois Department of Revenue.² Use the property tax calculator to see what you pay today in your county.

Run it with your numbersProperty tax

Your state’s programs

The table shows, for each state with a page on this site, the relief programs for older homeowners we have verified on its official page or in its law. Tap your state’s name to see each program’s detail, with the source quote and the date it was checked. If your state does not appear, that does not mean it has no relief: ask your county assessor’s office.

Property tax relief for older homeowners, by state

State	Relief for older owners
Alabama	Basic homestead exemption (type H-1) · No state property tax for owners over 65, disabled or blind
Alaska	$150,000 exemption for owners 65 and older and disabled veterans
Arizona	Senior Property Valuation Protection (valuation freeze)
Colorado	Senior homestead exemption (owners 65 and older)
Connecticut	Tax credit for owners 65 and older or totally disabled (Circuit Breaker)
Delaware	School property tax credit for owners 65 and older
District of Columbia	50% reduction for seniors and disabled owners
Georgia	$4,000 exemption for people 65 and older with low income · Floating inflation-proof exemption for people 62 and older
Idaho	Property Tax Reduction program
Illinois	Senior Citizens Homestead Exemption · Low-income Senior Citizens Assessment Freeze
Indiana	Supplemental homestead deduction (rises each year) · Credits for owners 65 and older
Iowa	Additional exemption for owners 65 and older
Kansas	Homestead refund (Form K-40H) · SAFESR refund for low-income seniors (Form K-40PT)
Kentucky	Homestead exemption for owners 65 or older or totally disabled
Louisiana	Assessment freeze for owners 65 and older and people with disabilities
Maine	State property tax deferral for owners 65 and older or with a disability
Massachusetts	Local senior exemption (clause 41C)
Mississippi	Regular homestead exemption (Tier 1) · Age or disability exemption (Tier 2)
Missouri	Property Tax Credit ("circuit breaker") for seniors and people with disabilities
Montana	Elderly Homeowner/Renter Credit (age 62 and older)
Nebraska	Homestead exemption for seniors, people with disabilities and veterans
New Jersey	ANCHOR, Senior Freeze and Stay NJ: one combined application · $250 deduction for seniors and disabled persons
New Mexico	Value freeze for low-income owners 65 and older or with disabilities
New York	Basic STAR school tax relief · Enhanced STAR for owners 65 and older
North Carolina	Elderly or Disabled Homestead Exclusion
North Dakota	Homestead credit for people 65 or older or with a disability
Ohio	Homestead exemption for seniors and people with disabilities
Oklahoma	Additional homestead exemption for lower-income households
Oregon	Property tax deferral for senior and disabled homeowners (apply by April 15)
Pennsylvania	Property Tax/Rent Rebate Program (PTRR)
Rhode Island	State property tax relief for people 65 and older or with a disability
South Dakota	Assessment freeze for seniors and people with disabilities
Tennessee	Property tax relief for older, disabled and disabled-veteran homeowners
Texas	School-district homestead exemption
Utah	Low-income homeowner's tax credit
Virginia	Local exemption or deferral for people 65 and older or with disabilities
Washington	Exemption for people 61 and older or with disabilities · Property tax deferral for people 60 and older or with disabilities
West Virginia	$20,000 homestead exemption for owners 65 or older or disabled · Senior citizens' tax credit for low-income homeowners
Wyoming	Long-term homeowner's exemption (65 and older)

Each program has its own age, income limit and deadline, and some must be applied for every year; check the detail on your state's page.² Source: each state's official tax pages

What to know before you defer

A deferral can help you stay in your home when money is short, but it has a cost. In Illinois it works like a loan against your home’s value, with a recorded lien, and the state recovers it with interest when the home is sold or transferred.² In Washington, you must have enough equity in the home to secure what the state pays, the deferred amount accrues 5% simple interest, and it is repaid when you sell, when the owner dies or when you stop living there.³

That means your heirs may receive the house with that debt. Talk to your family before applying. And before you sign, ask the office three questions: how much interest the deferred amount accrues, when it has to be repaid and what happens if you move in with family or into a care home. Write down the answers, the date and the name of the person who gave them. Our guide Wills, transfer-on-death deeds and inheriting a home explains how to leave the house in order. If you are thinking about a reverse mortgagereverse mortgageA reverse mortgage is a loan secured by your home for older homeowners. In the most common kind, HUD's Home Equity Conversion Mortgage (HECM), the youngest borrower must be 62 or older at closing. Instead of making monthly payments, you receive money; interest and fees are added to the balance each month, so the debt grows and your equity shrinks. The home stays in your name, but you must live in it, pay property taxes and insurance and keep it in good condition. It is repaid when you no longer live there, usually by selling the home. To get a HECM you must receive counseling from a HUD-approved agency.See the full definitionClose to pay your expenses, read our reverse mortgage (HECM) guide first: it is also a debt on the house.

If this is you

You turned 65 and live in Texas

Apply for the additional $60,000 school tax exemption and ask about your city's or county's local exemption.¹

Your income is low and the assessment rises every year

Ask whether your state has a freeze; in Illinois it is applied for every year with Form PTAX-340.²

Your home is paid off but you have little cash

A deferral lets you pay later, with interest and a lien on the house.²

You are older and you rent

Some states, such as Missouri and Pennsylvania, also give a credit or rebate to qualifying renters.⁶

You have a disability and are under 65

Several programs include you; in Pennsylvania, the rebate starts at 18 with a disability.⁷

You help your parents with their taxes

Go over their state's table and the bill together, and note each deadline.²

Mistakes that cost you

• Mistake: Thinking relief arrives on its own when you reach the age.

  Instead: It has to be applied for; in Cook County, the senior exemption is applied for every year.²

• Mistake: Not renewing the freeze.

  Instead: In Illinois you must file Form PTAX-340 every year for the freeze.²

• Mistake: Deferring without talking to your family.

  Instead: The deferred amount is repaid with interest when the home is sold or the owner dies.³

• Mistake: Moving out of the home without telling anyone.

  Instead: In Washington, the deferral must be repaid when the home stops being your primary residence.³

• Mistake: Skipping the rebate because you rent.

  Instead: Missouri and Pennsylvania also help qualifying renters.⁷

• Mistake: Paying someone to fill out the application.

  Instead: Pennsylvania offers free help with the application; ask your county or your state.⁷

What to do this week

1. Find your latest property tax bill and see which exemptions you already have.
2. Check your state’s programs in this guide’s table and open your state’s page.
3. Call your county assessor’s office and ask about the senior exemption, freeze, deferral and credit.⁵
4. Gather proof of your age, that you live in the home and of last year’s income.³
5. Mark each program’s deadline on your calendar and whether you must apply every year.²
6. If you are thinking about a deferral, talk with your family first about what will happen to the house.³