March 7, 2008

Information on Property Tax Relief for Low-Income Senior Citizens

 

Recently, some members of the Board have inquired about property tax relief for seniors in Mecklenburg County. Therefore, we are taking this opportunity to provide the Board with information that can be passed on to constituents who may also inquire about options.

 

Mecklenburg County, along with all counties in North Carolina, provides low-income Homestead Exclusions for qualifying individuals. To qualify, a person must be 65 years or older or permanently disabled and meet the income eligibility standards. For 2008, the income limit is $25,000. Those who qualify can exclude the greater of $25,000 or 50 percent of the taxable value of a permanent residence and one acre of land. The qualifying standards and exclusion amounts reflect a $5,000 increase in the Homestead Exclusion approved by the 2007 N.C. General Assembly. This is the largest increase in many years.

 

The General Assembly also created a tax deferral program, called a “circuit breaker”, which will take effect in July 2009. As the name implies, a circuit breaker works by triggering property tax relief when a qualifying resident’s property tax bill reaches a certain percentage of his or her income. The qualifications are similar to those for the Homestead Exclusion, but with a 50 percent higher income limit ($37,500). Taxpayers who qualify for the Homestead Exclusion could choose to take the exclusion or to defer property taxes that exceed 4 percent of their income. Taxpayers with incomes between $25,000 and $37,500 may defer taxes that exceed 5 percent of their income.

 

Because the circuit breaker is a tax deferral and not an exclusion, the most recent three years of deferred taxes must be repaid upon a disqualifying event (e.g. death, transfer of property, property no longer used as residence). These deferred taxes are a lien on the real property.

 

Information about the Homestead Exclusion and current applications are available online at the tax assessor’s or the tax collector’s web sites. People can also access these pages by visiting http://tax.charmeck.org then selecting the link titled, “Low Income Homestead Exclusion”. The application deadline is June 1 for the Homestead Exclusion. This information is also published in brochures and distributed to the Council on Aging and public library locations.

 

For more information, or to request copies of the brochure, please email Deborah Long Goldberg or call 704-336-2611.