Homestead exemptions and property taxes


K

kastnna

First time home buyer here with a couple of property tax
questions. It has been explained to me that 54 mills is the
total property tax rate for my soon-to-be residence (Auburn,
Alabama). We close 03/23/07.

This millage rate is applied to 20% of the assessed value of
the property to determine the property taxes due.

I have heard that a property that is "Homestead Exempt" has
the applicable percentage reduced from 20% to 10%.

What is the homestead exemption? Who is eligible? What are
the caveats/ limitations? How do I find out more about my
specific property?

Thanks in advance.
 
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P

Paul Thomas, CPA

kastnna said:
First time home buyer here with a couple of property tax
questions. It has been explained to me that 54 mills is the
total property tax rate for my soon-to-be residence (Auburn,
Alabama). We close 03/23/07.

This millage rate is applied to 20% of the assessed value of
the property to determine the property taxes due.

I have heard that a property that is "Homestead Exempt" has
the applicable percentage reduced from 20% to 10%.

What is the homestead exemption? Who is eligible? What are
the caveats/ limitations? How do I find out more about my
specific property?
Homestead exemption is the method used by the county to
reward homeowners who reside in the house. That way the
higher tax rate is on the second home, rental property,
commercial property, etc., you know "those rich folks".

Everyone who resides in the home they purchased. In theory
you can only have one homestead that can be exempted.

There may be issues if you use part of the home for business
or rental.

To find out more, go down to the county courthouse to the
property tax office, generally that of the tax assessors
office.
 
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Bill

(e-mail address removed) (kastnna) posted:
First time home buyer here with a couple of
property tax questions. It has been explained
to me that 54 mills is the total property tax rate
for my soon-to-be residence (Auburn,
Alabama). We close 03/23/07.
This millage rate is applied to 20% of the
assessed value of the property to determine
the property taxes due.
I have heard that a property that is
"Homestead Exempt" has the applicable
percentage reduced from 20% to 10%.
What is the homestead exemption? Who is
eligible? What are the caveats/ limitations?
How do I find out more about my specific
property?
Here in FL, where I live, qualification for the Homestead
allowance simply requires that you attest your property is
your main home and residence. For this, one receives a
$25,000 reduction in assessed value.

But every state (or county) will have its own variations.
(My home county, for example, offers a "bonus" exemption for
low-income seniors.)

I would suggest you visit your state's official website, and
also your county [assessor's] website. You could use the
site search engine to seek info on "Homestead tax
exemptions."

Bill
 
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