Homestead Exemption: What It Is and How to Claim Yours

A homestead exemption is one of the easiest ways for a new homeowner to lower a property tax bill, yet many people never claim it. In most places it is not automatic: you have to apply. This guide explains what a homestead exemption is, how it differs from state to state, which extra exemptions exist for seniors, people with disabilities and veterans, and how to apply before the deadline.

What is a homestead exemption?

A homestead exemption is a property tax break for the home you own and live in as your main residence. It subtracts a set dollar amount or percentage from your home’s assessed value before the tax rate is applied. A lower taxable value means a lower bill. Each state decides who qualifies, how big the exemption is and which taxes it covers.

Here is how it fits into your bill. Your assessor sets an assessed value, exemptions reduce it to a taxable value, and each taxing district applies its rate to that taxable value. If you want a refresher on that math, see our guide to how property taxes work.

Hypothetical example. A home has an assessed value of $300,000 and a combined tax rate of $20 per $1,000. Without an exemption, the bill is $6,000. A $25,000 exemption lowers taxable value to $275,000, so the bill becomes $5,500, a saving of $500 a year.

How does the homestead exemption vary by state?

It varies a lot. Some states exempt a large flat amount, some exempt a small one, and some apply different amounts to school taxes and other local taxes. Some states also link the exemption to a cap on how fast your assessed value can grow. The three examples below come from official state sources.

Always confirm current amounts with your county. Legislatures change these numbers, and local options can add to them.

Florida: up to $50,000 plus Save Our Homes

Florida’s Department of Revenue says a permanent residence may receive a homestead exemption of up to $50,000. The first $25,000 applies to all property taxes, including school taxes. The additional exemption of up to $25,000 applies to assessed value over $50,000 and only to non-school taxes, and it is adjusted each year for inflation when the Consumer Price Index rises (Florida Department of Revenue, PT-113).

Florida’s homestead also unlocks the Save Our Homes cap. After the first year, your assessed value cannot rise more than 3% or the percent change in the CPI, whichever is less. If you move to a new Florida homestead, you may be able to transfer (“port”) some of that built-up benefit if you set up the new homestead within three years of January 1 of the year you left the old one (Florida Department of Revenue, PT-112).

Texas: $140,000 off school taxes plus a 10% cap

The Texas Comptroller says school districts must offer a $140,000 residence homestead exemption. Other taxing units, such as cities and counties, may choose to offer a local option of up to 20% of appraised value, with a minimum of $5,000 (Texas Comptroller).

Texas also limits how fast a homestead’s appraised value can rise: no more than 10% a year for an owner who qualified the homestead in both the prior year and the current year, plus the value of any new improvements (Texas Comptroller).

California: a $7,000 homeowners’ exemption

California’s version is called the homeowners’ exemption. It reduces the taxable value of a qualifying owner-occupied home by $7,000. The home must have been the owner’s principal residence on the lien date, January 1, and you file once with your county assessor (California State Board of Equalization). Rentals and vacation homes do not qualify (California State Board of Equalization).

What extra exemptions exist for seniors, people with disabilities and veterans?

Many states stack extra relief on top of the basic homestead exemption for older homeowners, homeowners with disabilities and disabled veterans or their surviving spouses. Amounts and rules vary widely, and you usually must apply and show proof of age, disability rating or service.

Examples from Texas, based on the Texas Comptroller:

• Age 65 or older, or disabled: an additional $60,000 exemption from school district taxes. Other local units may offer at least $3,000 more.
• Disabled veterans: a partial exemption on one property, based on the veteran’s disability rating (Form 50-135).
• 100% disabled veterans: a total exemption on the residence homestead for a veteran awarded 100% disability compensation and rated 100% disabled or unemployable. Some surviving spouses also qualify.
• Surviving spouses of service members killed in the line of duty: a total exemption on the homestead if they have not remarried.

Florida publishes separate guides on benefits for homeowners 65 and older and for active-duty military and veterans, which list the requirements there. Other states have their own programs, and some offer tax deferrals or credits instead of exemptions. Ask your county assessor what is available.

How do you apply for a homestead exemption?

You apply with your local property tax office, not the state. That may be called the county assessor, property appraiser or appraisal district. Many offices accept applications online. Expect to show that you own the home and live in it as your primary residence.

1. Find your office. Search your county’s assessor, property appraiser or appraisal district website.
2. Get the right form. Florida uses Form DR-501. Texas uses Form 50-114. California uses Form BOE-266. Your county may have its own version.
3. Gather proof of residency. Florida lists items such as a Florida driver license, vehicle registration, voter registration and proof of paying utilities at the address (Florida Department of Revenue, PT-113). Texas generally asks for a copy of your driver’s license or state ID, with an address that matches the home, unless you qualify for a waiver (Form 50-114).
4. File before the deadline and keep a copy or confirmation number.
5. Check your next tax bill or notice to confirm the exemption shows up.

When are the deadlines?

• Florida: March 1 of the tax year, and you must own and live in the home by January 1 (Florida Department of Revenue, PT-113).
• Texas: The general deadline is before May 1 (Texas Comptroller). Form 50-114 says you may file a late application up to two years after the deadline (Form 50-114).
• California: File by February 15 to get the full exemption for that year (California State Board of Equalization).

What are the most common homestead exemption mistakes?

The biggest mistake is assuming the exemption is automatic. Others include missing the deadline, keeping an exemption after the home stops being your primary residence, and claiming more than one homestead. Each can cost you money, and the last two can lead to back taxes and penalties.

Florida explains that a homestead that is rented, is no longer your permanent home, or whose owner leaves the state loses eligibility, and that a loss of homestead triggers reassessment and removes the Save Our Homes benefit (Florida Department of Revenue, PT-112).

What if your exemption is denied or your bill still looks wrong?

If your application is denied, you can usually challenge the decision. In Florida, you may file a petition with the county’s value adjustment board (Florida Department of Revenue, PT-113). In Texas, a denied exemption is one of the issues you can raise in a protest to the appraisal review board.

If the exemption is in place but the bill still seems high, the problem may be your home’s assessed value. Our step-by-step guide to appealing a property tax assessment explains how to check your value and build a case. And if you pay taxes through your mortgage, a new exemption can lower your monthly payment after your servicer’s next review; see our explainer on mortgage escrow accounts.

This guide is general information, not legal or tax advice. Your county assessor’s office is the final word on whether your home qualifies.