What is the Homestead Exemption?
This is a statewide program, administered by County Auditors under rules established by the Ohio Legislature and the Ohio Department of Taxation. This allows senior citizens (65 or older) as well as permanently and totally disabled homeowners to reduce their real estate taxes by the amount equal to the taxes that would otherwise be charged on $25,000 of the market value of an eligible taxpayer’s homestead or residence. The homestead may include up to one acre of land. Under the changes made by the Ohio Legislature and beginning with applications for tax year 2014, new participants in the program will be subject to an income test to be eligible. The exemption will only be available to those homeowners with household incomes not exceeding $30,500 in Ohio Adjusted Gross Income for the preceding year.
Existing homestead recipients will continue to receive the homestead exemption credit without being subject to the income test!
The homestead exemption is “portable” under the new law, meaning that an individual currently receiving the homestead exemption will continue to receive the exemption and will continue to be exempt from the income test even if the individual sells an existing residence and purchases a new residence anywhere in Ohio. The homestead exemption is associated with the individual eligible for the homestead exemption and not a particular residence. (If a participant relocates and purchases property anywhere in the state of Ohio, they will qualify for the exemption on the new home, provided they show that they were receiving homestead exemption for tax year 2013 (see DTE form 105G). The individual will continue to be exempt from the income test.
Qualifications for the Program Under the New Guidelines
- Reaching age 65 by December 31st in the year of application or being permanently and totally disabled, regardless of age on January 1st in the year of application.
- Own the home or manufactured home as the primary place of residence as of January 1st in year of application.
- Photocopy of a picture ID for proof of age, such as a driver’s license, State of Ohio ID card or a current or expired passport.
- Beginning in 2014, an Ohio Adjusted Gross income not exceeding $30,500 in the preceding year.
In order to be exempt from the income test, the homeowner must have received the homestead exemption credit in Ohio for tax year 2013. Eligible homeowners, must have qualified as an applicant for 2013, OR apply as a late applicant for 2013, between the first Monday in January 2014 and the first Monday of June 2014 to secure the homestead exemption for 2013.
Definition of a surviving spouse: An eligible surviving spouse must (1) be the surviving spouse of a person who was receiving the homestead exemption by reason of age or disability for the year in which the death occurred, and (2) must have been at least 59 years of age on the date of the decedent’s death.
Permanent disability: Permanent and totally disabled means a person who has, on the first day of January of the year for which the homestead exemption is requested, some impairment of body or mind that makes him/her unfit to work at any substantially remunerative employment for which he/she is reasonably able to perform and which will, with reasonable probability, continue for an indefinite period of at least twelve months without any present indication of recovery, or who has been certified as totally and permanently disabled by an eligible state or federal agency.