Published March 1, 2022
What Does the Homestead Tax Exemption Mean to You?
Tax season is upon us once again! If you’re anything like us, you would love an opportunity to save some money this tax season. The homestead tax exemption in Pennsylvania and New Jersey is here to help.
If you hear the words “tax” and “exemption” and immediately feel your head swimming, you’re not alone. These can be extra confusing concepts if you don’t work in the tax or accounting world. The concept is simple- the tax exemption lowers your home’s value in the eyes of the government. If your home’s value is reduced, then you’ll reap the benefits of paying lower taxes on the value of your home.
There are a few income and property requirements that apply to both Pennsylvania and New Jersey’s exemption. Learn more about Pennsylvania’s here and learn more about New Jersey’s exemption here.
Here are a few other frequently asked questions concerning the Homestead Exemption.
What Does the Exemption Do?
It reduces the property value on which you’ll be required to pay taxes. This means that your total taxable amount will be lower and your payments will, in turn, be lower.
Will I Need to Apply Each Year?
The exemption is something you’ll only need to apply for once throughout the life of the home you’re in. This means that the exemption will roll over year after year as long as you own the property.
What Sort of Home Qualifies for the Exemption?
You must be the owner and the home must be your primary residence.
How Long Will the Exemption Last?
For as long as you are the owner of the property and it is your residence. If the deed changes hands, the exemption will no longer apply. The new homeowner will need to file for the property and you will need to apply for the exemption on your new property if applicable.
My Property is Commercial Use, Does It Apply?
If you run a business out of your home, then yes! The exemption applies to mixed use properties. If you happen to live in a residence and operate a business on the premises, then the property would qualify.
I Live in a Condo, Does It Count?
Yes! The homestead exemptions to apply to condominium dwellers as long as the property is a full-time residence and the other rules also can be met.
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