Real estate tax break for senior and disabled homeowners

Senior baby boomers and disabled homeowners can save on their real estate tax bill, thanks in part to former Ohio Democratic governors, John Gilligan and Ted Strickland.

John Gilligan, father of Ohio’s state income tax, needed money to balance the budget. In order to get his state income tax legilation passed, deals were made. One of these was a reduction in property taxes for some people. It is known as the homestead exemption; the year was 1971.

The homestead exemption worked by exempting a certain amount of the tax value of the property. Strict income tests were applied to determine who qualified, and the exemption required reapplying every year.

Thanks to Ted Strickland, the income test was eliminated in 2007. He realized many seniors were ineligible because of they earned too much. He proposed making the homestead exemption more generous by allowing all seniors 65 and older to qualify, regardless of income.

The program had also been cumbersome and expensive to administer. By opening it up to all seniors and filing only once, forests of trees and government payrolls were saved.

The current average Ohio saving is about $400 a year. University Heights residents will save more because of a higher tax rate. During the 2010 tax year, the homestead exemption saved UH homeowners about $776 each.

The exemption offers eligible homeowners the opportunity to shield up to $25,000 of the market value of their homestead (house plus one acre) from taxation. This means that a home valued at $100,000 will generally be taxed at $75,000. If you have a home in University Heights valued at $25,000 or less, you pay no real estate tax.

Many of the 1,700 people in University Heights born in 1946 or earlier are already enrolled. How can you check to see if you are? Look at your real estate tax bill for 2010. If the box marked Homestead Exempt is blank, you are not enrolled.

Baby boomers born in 1946 may have missed the application window. Yes, boomers, there was an application window. But there is still hope. When you request your application from the Cuyahoga County Fiscal Office, make sure you check both boxes: "Current application" and "Late application for prior year."

In last month’s election, University Heights residents voted to increase our real estate taxes for the CH-UH City School District. You may have a crisis of conscience about applying for the homestead exemption. Don’t. The State of Ohio reimburses school districts and local governments for the amount of revenue taxpayers save with the exemption. Our schools will not lose a penny.

The county office knows how much it needs to collect from the state for the homestead exemptions. State law requires that the county shall be compensated dollar for dollar. The county, in turn, reimburses the local entities.

Don’t wait. If you were born in 1947 or earlier, contact the county for your application. You will be 65 in 2012 and need to start the paperwork to get the benefit in your first year of eligibility. The forms will be mailed out mid-December and must be filed no later than the first Monday in June. For those born 1946 or earlier, remember to check both boxes.

Anita Kazarian

Anita Kazarian, a marketing professional and president of Noah’s Landing, is a longtime resident of University Heights. Contact her at anitakazarian@gmail.com.

Read More on University Heights
Volume 4, Issue 12, Posted 4:05 PM, 12.01.2011