Homestead Exemption- What is it?
If you are new home owner or if you are a homeowner who has questions about your homestead exemption, please look at some of the most commonly asked questions below. If you have any unanswered questions, please call or email. firstname.lastname@example.org.
1. I own my home; do I get a property tax break for owning my home?
You may apply for homestead exemptions on your primary residence (the residence you live at). Homestead exemptions reduce the value at which your taxes are accessed so in turn this lowers taxes.
2. My mother is the landlord for an investment property, does this property qualify for a tax exemption? The only home that qualifies for a homestead exemption is the property you reside in. Investment properties do not qualify for a tax exemption. You must claim the property as your primary residence starting January 1st. If you did not close on your new home before January 1st you will not be able to file homestead until the following tax year however if the prior owners had the homestead exemption your taxes will be accessed at their rate. If you are over the age of 65 or disabled, the January 1st rule does not apply.
3. What exactly is a homestead? A homestead can be a separate structure, condominium or a manufactured home located on owned or leased land, as long as the individual living in the home owns it. A homestead can include up to 20 acres, if the land is owned by the homeowner and used for a purpose related to the residential use of the homestead.
4. Are there more than one type of homestead exemptions?
There are several types of exemptions you may receive.
School taxes — all homeowners. If you qualify for the homestead exemption, you will receive at least a $25,000 homestead exemption on the value of your home for school district taxes.
County taxes — all homeowners. Harris County currently provides a 20% optional homestead exemption to all homeowners. This means, for example, that if your home is valued at $100,000, the exemption will reduce its taxable value for Harris County taxes by $20,000 to $80,000. Galveston County offers 20% with a minimum of $5,000.
Optional exemptions — all homeowners. Any taxing unit, including a school district, city, county or special district, may offer an exemption for up to 20% of your home's value. The amount of an optional exemption can't be less than $5,000, no matter what the percentage is. For example, if your home is valued at $20,000 and your city offers a 20% optional exemption, your exemption is $5,000, even though 20% of $20,000 is just $4,000. The governing body of each taxing unit decides whether it will offer the exemption and at what percentage. This percentage exemption is added to any other homestead exemption for which the applicant qualifies.
5. When should I file my homestead exemption? The deadline for the homestead exemption is April 30th.
6. If you temporarily move away from your home, you may continue to receive the exemption if you do not establish a principal residence elsewhere, you intend to return to the home, and you are away less than two years. You may continue to receive the exemption if you do not occupy the residence for more than two years only if you are in military service serving inside or outside of the United States or live in a facility providing services related to health, infirmity or aging.
If you are a past client of The Freund Group you will be receiving the information for your homestead exemption along with your HUD soon.