Expansion of Homestead Exemption a victory
Published 12:00 am Wednesday, August 8, 2007
As I have highlighted in several columns over the last few weeks, House Bill 119, the state budget bill which was signed by Gov. Ted Strickland on June 30, was a turning point in the future growth and success of our state and the well-being of all Ohioans.
From education to health care to economic development, this budget included significant funding and historic initiatives that I truly feel will have a positive impact on this state for years to come.
While all Ohioans — young or old, rich or poor, man, woman or child — will benefit from HB119 in some way.
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The health and well-being of Ohio’s seniors and disabled Ohioans became a major focus during the budget process. For instance, my colleagues and I worked to adopt several important health care reforms in the budget bill designed to improve health care quality, access and affordability for Ohio’s seniors and disabled.
However, the portion of HB 119 that will perhaps have the most significant impact on the everyday lives of Ohio’s senior and disabled population is the expansion of Ohio’s Homestead Exemption.
For years, the state has offered property tax relief to thousands of Ohio seniors and disabled Ohioans through the Homestead Exemption. Unfortunately, complex income requirements have restricted eligibility for many Ohioans. For example, according to the Ohio Department of Taxation, during the 2006 tax year, any senior citizen or disabled Ohioan with a household income of more than $26,200 per year could not qualify for savings.
Recognizing the financial burden of property taxes on all Ohio’s seniors and disabled Ohioans, many of whom are on fixed incomes, the governor, along with state legislators, worked to expand the state’s property tax relief program.
During the budget process, we worked with the governor to authorize the securitization of Ohio’s tobacco settlement funds to replace the issuance of bonds for school facilities and higher education facilities over three years. This transaction — the largest in state history — allowed the state to expand the Homestead Exemption to include all senior citizen homeowners and permanently disabled homeowners, regardless of their income.
Specifically, under the program’s expansion, the state will exempt from taxes the first $25,000 of their home’s value. For example, the owner of a $100,000 home who is eligible for the Homestead Exemption would receive a tax bill as if their home were worth $75,000.
As a result of these changes, it is estimated that the number of households eligible for the Homestead Exemption is expected to grow from about 220,000 to 775,000. In addition, while the amount of property tax savings will vary from community to community, there should be an average discount of about $400 per homeowner statewide.
To qualify, a homeowner must be at least 65 years old or turn 65 in 2007; or, certified totally and permanently disabled as of Jan. 1, 2007; or, the surviving spouse of a qualified homeowner who was at least 59 years old on the date of their spouse’s death.
While we have expanded eligibility for the Homestead program, in order to take advantage of these important property tax savings you must first apply. It is important to note that homeowners who currently receive the Homestead Exemption will automatically qualify for savings under the program expansion and do not have to reapply.
Application forms are available from all county auditors and through the Ohio Department of Taxation and must be submitted by Oct. 1 to receive savings on tax bills payable in 2008. For more information, please visit www.tax.ohio.gov.
Sen. John A. Carey represents of the 17th District.