While there are so many joys to having your own home, one big part of being a homeowner is - you guessed it - dealing with property taxes. But, did you know you can now get up to $80,000 deducted from your assessment by the City of Philadelphia with the newly expanded Homestead Exemption program?
What’s New?
Mayor Kenney signed into law the new and improved Homestead Exemption bill earlier this month with the aim of decreasing the financial strain of new property assessments for Philly homeowners. With the city freezing annual calculations for the past three years due to the pandemic, and property values having risen an average of 31 percent, this is a much needed adjustment!
The Homestead Exemption reduces the taxable portion of your property’s assessed value by $80,000 (or $1,119 annually) which is a big chunk of change over the years. The exemption was previously valued at $45,000, which saved homeowners about $629 annually. That’s a significant increase for sure!
Before this new version of the Homestead Exemption went into effect, a participating homeowner’s property assessment was capped at 150% of the previous year’s value. “For example, if the home was assessed at $100,000 in 2022, the property value in 2023 could not exceed $150,000.”
This could only happen if a homeowner’s property value had jumped at least 50% after the homestead exemption was deducted. That is no longer the case, enabling more residents to take advantage of the revamped program.
Who Qualifies?
So who actually qualifies for a Homestead Exemption in Philadelphia? If you own your primary residence, you are eligible for the Homestead Exemption on your
Real Estate Tax.
According to the City, “You may be eligible for a conditional Homestead Exemption if your name is not on the property’s deed. This may be because you:
- inherited the house from a deceased relative
- A fraudulent mortgage or deed was recorded for your house
- You are party to a rent-to-own agreement and have paid all or some of the sale price for the house
How To Apply
December 1st is the final deadline to apply for the Homestead Exemption program. Early filers should apply by September 13, to see approval reflected on their Real Estate Tax bill for the following year. Applicants approved after September 13 date will receive a second bill with an adjusted amount due.
To apply by phone, call the Homestead Hotline at (215) 686-9200.
Application accepted? You won’t have to reapply for the exemption again. As long as you continue to own and live in the property, you will receive property tax savings every year going forward! And if you are one of the 228,000 homeowners already using an exemption, this change will be reflected automatically. No need to lift a finger! So, that’s how you can save thousands of dollars on taxes as a Philly Homeowner.
