Thursday, February 19, 2009

Some Happy stuff for today...

See my Economics Blog for some HAPPY NEWS :) Have a lovely day, y'all! Bo

Tuesday, February 3, 2009

What is a “Homestead Exemption” and how do I get one?

In Georgia, a homeowner is entitled to a homestead exemption on their home and property as long as 1) the home was owned by the homeowner and 2) it was their legal residence as of January 1 of the current tax year. That’s great, but what does that really mean? Let’s break it down, step by step.

“Homestead” historically meant the dwelling house and the adjoining land (as well as the land underneath the home) where the head of the family dwells—this came from the concept of a traditional “family farm”. “Exemption” more or less means that the person making the claim of homestead will be exempted or immune from a portion of the ad valorem property tax on their real property (ad valorem means “according to value” if you’re curious). To sum it up, a homestead exemption gives you a tax break on your principal legal residence—you must actually occupy the home and use it as your legal residence. A second home or rental property would obviously not apply.

To obtain this exemption you will need to apply at your local county’s Tax Commissioner OR Tax Assessor’s office. To further confuse the issue, some counties will allow you to do this online, whereas many will make you file the paperwork in person. The process is quite simple—you need to obtain the proper form (usually available online or at their offices) and you will need to provide proof of ownership. That can also differ per county so you definitely need to contact your county to confirm a) what they need and b) where to go. The key is that you own and occupy the property as of January 1 of the current year. Let’s look at a few examples:

You bought your new home December 31, 2008 (Congratulations!) and it will be your primary legal residence. You may file your homestead exemption in 2009 for property taxes for 2009. Note-you have until March 1st to file this exemption for 2009.

You buy your home February 13, 2009. You can actually file your Homestead Exemption at any time in 2009, but it will not take affect until 2010 (translation: you can file in 2009 to get it over with, but there will be no affect on your tax bill until 2010). Note: some counties require a copy of the recorded Warranty Deed to your home in order to process the Homestead exemption, so be aware that you may have time constraints when filing as it can be weeks before the deed is on the County Clerk’s records.

Again, contact your county directly as some will only require your declaration, a copy of your closing HUD-1 Settlement Statement and/or a current utility bill. Other traditional requirements are further proof of Georgia/County residency such as your driver’s license, car tag information and proof of automobile registration.

For more information, go to the Georgia Department of Revenue’s website and also use this link to find out more info about your particular county.

Remember--it's a GREAT time to buy a home; hopefully the GOP will get some of their tax cuts for homebuyers in this new economic "Gimme" bill (God help us) to actually do something to stimulate home sales further (like in December--check out my Economics Blog for more info!).