Several types of homestead exemptions have been enacted to reduce the burden of ad valorem taxation for Georgia homeowners. These exemptions apply to homestead property owned by and taxpayer and occupied as his or her legal residence (some exceptions to this rule apply and your tax assessors office can explain them to you).
To receive the benefit of the homestead exemption, the taxpayer must file an initial application. The application must be filed in person before April 1 of the year for which the exemption is first claimed by the taxpayer. If more than one person owns and resides on the property, only one of the owners needs to apply for the exemption; however, that person's name must be listed on the deed.
Once granted, the homestead exemption is automatically renewed each year. The taxpayer does not have to apply again unless the property owner who applied for the exemption moves or dies or his/her name is taken off the deed to the property, there is a change in ownership of property or the taxpayer seeks to qualify for a different kind of exemption.
When a property owner qualifies for a better exemption, it is his/her responsibility to apply for the better exemption.
Property owners who reside within city limits should also check with the city where they reside to see if a homestead exemption is available for their city taxes.
Under the authority of the State Constitution, several different types of homestead exemptions are provided. In addition, local governments are authorized to provide for increased exemption amounts and several have done so. Local county exemptions supersede the state exemption amount when the local exemption is greater than the state exemption.
Homestead Exemption filing dates are January 1 of the previous year, or the purchase date, through April 1 of the applicable tax year.
Effective June 1, 2005 homestead exemptions may be filed for any time during the year. However, exemptions must be filed for by April 1 to apply to the current tax year. You must still own and occupy the property as of January 1 to be eligible.
Exemptions Offered by the State and Counties
The State of Georgia offers homestead exemptions to all qualifying homeowners (those exemptions are shown below on this page). Habersham County and other counties have implemented local homestead exemptions by local legislation above the amounts offered by the State. As a general rule the exemptions offered by the county are more beneficial to the homeowner. In Habersham County, property owners 65 or older who make less than $12,000 (gross income) are 100 percent exempt from school general and school bond taxes. This exemption may be combined with other exemptions a for which a taxpayer may qualify.
Homestead Valuation Freeze Exemption
The Constitution of Georgia allows counties to enact local homestead exemptions. Habersham and a number of counties have implemented an exemption that will freeze the valuation of a residence and up to five acres of property at the base year valuation for as long as the homeowner resides on the property. Even as property values continue to rise the homeowner's taxes will be based upon the base year valuation. This exemption may be for county taxes, school taxes, and/or municipal taxes.
Homestead Exemptions Offered by the State
Standard Homestead Exemption
The home of each resident of Georgia that is actually occupied and used as the primary residence by the owner may be granted a $2,000 exemption from state, county and school taxes except for school taxes levied by municipalities and except to pay interest on and to retire bonded indebtedness. The $2,000 is deducted from the 40 percent assessed value of the homestead. The owner of a dwelling house of a farm that is granted a homestead exemption may also claim a homestead exemption in participation with the program of rural housing under contract with the local housing authority. (O.C.G.A. § 48-5-44)
Individuals 65 Years of Age and Older May Claim a $4,000 Exemption
Individuals 65 years of age or over may claim a $4,000 exemption from all state and county ad valorem taxes if the income of that person and his spouse does not exceed $10,000 for the prior year. Income from retirement sources, pensions, and disability income is excluded up to the maximum amount allowed to be paid to an individual and his spouse under the federal Social Security Act. The maximum social security benefits for 2006 is $49,272. The owner must notify the county tax commissioner if for any reason they no longer meet the requirements for this exemption. (O.C.G.A. § 48-5-47)
Individuals 62 Years of Age and Older May Claim Additional Exemption for Educational Purposes
Individuals 62 years of age or over that are residents of each independent school district and of each county school district may claim an additional exemption from all ad valorem taxes for educational purposes and to retire school bond indebtedness if the income of that person and his spouse does not exceed $10,000 for the prior year. Income from retirement sources, pensions, and disability income is excluded up to the maximum amount allowed to be paid to an individual and his spouse under the federal Social Security Act. The maximum social security benefits for 2006 is $49,272. The owner must notify the county tax commissioner if for any reason they no longer meet the requirements for this exemption. This exemption may not exceed $10,000 of the homestead's assessed value. (O.C.G.A. § 48-5-52)
Floating Inflation-Proof Exemption
Individuals 62 years of age or over may obtain a floating inflation-proof state and county homestead exemption, except for taxes to pay interest on and to retire bonded indebtedness, based on natural increases in the homestead's value. If the appraised value of the home has increased by more than $10,000, the owner may benefit from this exemption. Income, together with spouse or any other person residing in the house, can not exceed $30,000. This exemption does not affect any municipal or educational taxes and is meant to be used in the place of any other state and county homestead exemption. (O.C.G.A. § 48-5-47.1)
Homestead Exemption for Disabled Veterans
Any qualifying disabled veteran may be granted an exemption of $50,000 from paying property taxes for state, county, municipal, and school purposes. The value of the property in excess of this exemption remains taxable. This exemption is extended to the unremarried surviving spouse or minor children. (O.C.G.A. § 48-5-48)
Homestead Exemption for Unremarried Surviving Spouse
The surviving spouse of a member of the armed forces who was killed in any war or armed conflict will be granted a homestead exemption from all ad valorem taxes for state, county, municipal and school purposes in the amount of $50,000. The surviving spouse will continue to be eligible for the exemption as long as they do not remarry. (O.C.G.A. § 48-5-52.1)
The homestead exemptions offered by the State are detailed by the following table:
How to Figure a Homestead Exemption
The basic formula to figure the tax on a home using the State's standard $2,000 homestead exemption is:
[(40% X FMV) - $2,000] X millage rate = tax due
Example: If a person that owned a home with a market value of $100,000 in an unincorporated area of a county where the millage rate was 25.00 mills, that person's property tax would be $950 (millage rates for motor vehicles in 2006 were the same rates applied to real property in 2005). Multiply $100,000 by 40 percent which is equal to the assessed value of $40,000 and subtract the homestead exemption of $2,000 from the assessed value. Then multiply $38,000 by .02500 which is equal to $950.
Property Tax Deferral Program
In addition to the various homestead exemptions that are authorized, the law provides a Property Tax Deferral Program whereby qualified homestead property owners 62 and older with a gross income of $15,000 or less may defer but not exempt the payment of ad valorem taxes on part or all of the homestead property. Generally, the tax would be deferred until the property ownership changes or until such time that the deferred taxes plus interest reach a level equal to 85 percent of the fair market value of the property.
With respect to all of the homestead exemptions, the board of tax assessors makes the final determination as to eligibility. If the homestead application is denied, the taxpayer must be notified and an appeal procedure then is available to the taxpayer.
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