All of us at VV&W want to help you save money on your real estate taxes and one way you can do that is by claiming Homestead Exemption.
What is the Homestead Exemption? It is a tax incentive provided by the state of Alabama to homeowners who use their property as their primary residence. It helps reduce property taxes for homeowners, which is always great news for our clients! The Homestead Exemption is additional $48 saving per year, but the process of declaring the property as non-income producing is what saves a homeowner the most money.
How do you know if you qualify for Homestead? You can claim this exemption if you purchased property for personal use after October 1, 2022 but before September 30, 2023, or if your financial planning involved changing any owner names on your non-leased properties during those dates.
What is the deadline to claim Homestead? If you qualify then you need to visit our Tax Assessor’s office before December 31st to classify your property as one of two statuses:
1. non-income producing (like a second home you don’t intend to lease) OR
2. your primary residence.
What documents do you need to bring to the Tax Assessors office? Some may tell you to claim “homestead exemption” but there is a lot more to it than that. We want you to be prepared before the Dec. 31st deadline, so here is a list of what you will need:
- The copy of your deed – When a home sale closes, the attorney has the seller sign a deed transferring ownership to the buyer. The closing attorney’s office then records the deed and mails a recorded copy to the buyer’s address. Once the new owner receives the recorded copy, they should take it to the Tax Assessor’s office to prove ownership. It should have the correct address, legal description, and owner names
- A driver’s license – it is important that the license has the address of the residence you are claiming homestead on. If your license is an Alabama license, your address change can be easily obtained at the License Director’s office at the Madison County Service Center – the same location where you would go to present your deed. You can change your license address the same day as you visit the Tax Assessor. BUT, if you have an OUT OF STATE LICENSE: you must arrange an appointment with the Department of Public Safety at 1115 Church Street and have your license changed there before going to the Tax Assessor’s office. They also have offices in Guntersville, Scottsboro, Decatur, and Athens.
- Homeowner’s insurance policy providing coverage as of October 1, 2022 AND utility set date letter from Huntsville Utilities with no later than that start date – That letter can be obtained by calling Huntsville Utilities’ customer service number at 256-535-1200. Some cases will not require these, but it’s better to have all the information rather than being surprised.
Homestead is not the only exemptions that you can claim! You can also claim exemptions, such as
- Disability exemptions – If you are a veteran or if you are totally and permanently disabled, you are eligible for the property to be exempt from ad valorem taxes.
- Requires proof of disability
- Award letter from Social Security
- Benefits verification letter from the VA
- Or two official physician affidavits of permanent and total disability. A link to those forms is on the Tax Assessor’s website.
- Age Exemptions – If a property owner is 65 years old, or older, they may qualify for additional exemptions, mainly from state taxes. They must provide:
- Proof of age and income
- Verification of non-filing letter from IRS or Taxpayer’s transcript if taxpayer is not required to file federal income taxes
- Handwritten tax returns are not accepted
- Additional exemptions may be possible if income of taxpayer and spouse is less than $12,000
Deadline to apply for the $48 homestead exemption (and correctly classify your property’s tax status) is December 31.
The Tax Assessor’s office is located at the Madison County Service Center at 1918 Memorial Parkway at the corner of the Parkway and Oakwood Drive.