CFED Scorecard

CFED Assets & Opportunity Scorecard

Housing & Homeownership
Property Tax Relief
Overview

Property taxes are an important revenue source for local governments, but they can be a heavy burden for low- and moderate-income families, particularly those whose housing costs have increased faster than their incomes. Even in periods when home values decline, tax burdens may continue to rise due to the way states and localities calculate property tax. States have used many strategies to reduce property tax burdens, including those that provide relief more widely to all homeowners, e.g., homestead exemptions and assessment caps. More effective, however, are programs targeted at homeowners that need relief most.

What States Can Do

Property tax “circuit breakers” provide households with direct property tax relief that increases as household income declines. Circuit breakers kick-in when property taxes exceed a certain percentage of a household's income and provide a rebate or tax subsidy for qualifying households. Although states often use age (i.e., being elderly) or disability as a proxy for financial need, property tax circuit breakers that are available to lower-income working-age homeowners and renters better target community need.

Strength of State Policies: Property Tax Relief

Does the state provide property tax relief via a well-targeted circuit breaker? 1
StateWell-targeted
circuit breaker?
Eligibility requirements
Alabama
Alaska
Arizona Elderly only
Arkansas
California Elderly or disabled only
Colorado Elderly or disabled only
Connecticut Homeowners only
Delaware
District of Columbia
Florida
Georgia
Hawaii 2
Idaho Homeowners only
Illinois Elderly, disabled, or
homeowners only
Indiana
Iowa 3 Elderly or disabled only
Kansas Homeowners only
Kentucky
Louisiana
Maine
Maryland
Massachusetts Elderly only
Michigan
Minnesota
Mississippi
Missouri Elderly, disabled, or veterans only
Montana Homeowners or elderly only
Nebraska Elderly or disabled only
Nevada
New Hampshire Homeowners only
New Jersey Homeowners only
New Mexico Elderly or homeowners only
New York
North Carolina Elderly or disabled only
North Dakota Elderly or disabled only
Ohio
Oklahoma Elderly or disabled homeowners only
Oregon
Pennsylvania Elderly or disabled only
Rhode Island Elderly or disabled only
South Carolina
South Dakota Elderly or disabled only
Tennessee
Texas
Utah Elderly only
Vermont
Virginia
Washington Elderly or disabled only
West Virginia Elderly or homeowners only
Wisconsin
Wyoming Elderly or disabled only

Notes on the Data

1. "Significant Features of the Property Tax," Lincoln Institute of Land Policy and George Washington Institute of Public Policy. (Accessed January 8, 2016). States receive credit if they: a) offer a state-funded property tax circuit breaker and b) open program eligibility to working-age households with children, renters and homeowners. All states offering property tax circuit breakers impose income-based eligibility restrictions. The Scorecard does not take any income limits imposed by the state into account when grading this policy measure.

2. Hawaii offers a state-funded circuit breaker program, but each county applies its own qualifications. In Maui, all homeowners are eligible; in Honolulu, only elderly residents qualify. The circuit-breaker program is not in place in all counties.

3. Beginning in 1995, an Iowan who has attained the age of 23 or a head of household and was not claimed as a dependent on any other person's tax return for the base year is eligible by statutes for this program if they meet income requirements. However, the state has never provided funding for this portion of the program.

How States Are Assessed

States receive credit if they offer property tax circuit breakers, and these circuit breakers are made available to working-age households with children, renters and homeowners.

What States Have Done

Although 33 states and the District of Columbia provide some form of property tax circuit breaker, only seven states and D.C. make these circuit breakers available to working-age households with children, to renters and to homeowners.

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