No, unless…See exceptions, processes and additional benefits.
By Ellie Williams The Nest
A homestead exemption decreases the taxable value of a property, reducing the amount of property taxes a homeowner must pay each year. This is especially valuable for senior citizens living on a fixed income and residents of areas with rapidly changing property values. Homestead exemptions usually apply as long as the homeowner lives in the residence, but there are exceptions.
Once you’re granted a homestead exemption, if you continue to use the same property as your principle residence you do not need to reapply. The agency that handles property matters, frequently called the county assessor’s office, automatically continues the exemption each year. The office sends an annual notice to homeowners confirming their homestead exemption. You do not need to respond to this mailing unless your living situation has changed, in which case you fill out the form with your updated information and submit it to the assessor’s office.
Homeowners who use the property as their primary residence qualify for a homestead exemption. For example, if you own rental property, it doesn’t qualify because you don’t live there. If you own and use multiple properties such as a lake house, an apartment in the city and a vacation home, only the property you live in the majority of the time qualifies for a homestead exemption. Each state has specific requirements for claiming a homestead exemption. For example, in Oklahoma you must be a state resident, live in the residence as of Jan. 1 of the tax year, and have a deed executed on or before Jan. 1 and filed on or before Feb. 1.
If you move to a new primary residence, you must reapply for a homestead exemption. This is true if you sell your home and buy a new one, or if you retain ownership of the home but begin using a new property as your primary residence. For example, you might rent out your home and move into another property you own.
You must reapply for a homestead exemption if you change your deed, even if you continue to live in the same property. For example, if you divorce or your spouse dies, you must reapply if you remove his name from the deed. This also applies if you inherit the property from a family member. Even if the original homeowner had a homestead exemption, it does not transfer if someone else takes possession of the property. You must apply for your own homestead exemption because you are considered a new owner.
Several states offer additional homestead exemptions for senior citizens, and the rules for these differ. In Illinois, for example, homeowners must be at least 65, have an annual income of no more than $50,000 and reapply for the exemption each year, as of 2012. Seniors must reapply for the senior exemption even if their state or county does not require them to reapply for a general exemption.