Property Tax Relief Programs
North Carolina offers three property tax relief programs for the permanent residence of qualified homeowners. Applications for property tax relief are available at the beginning of January and are accepted until June 1 each year.
Elderly or Disabled Exclusion
Applicants must be 65 years of age or totally and permanently disabled. In addition, the previous year's total income for both an applicant and spouse cannot exceed $29,500. For unmarried joint property owners, each owner must apply separately and benefit limitations may apply based on percentage of ownership.
This program excludes from taxation the first $25,000 or 50% (whichever is greater) of assessed value for the permanent residence. Exclusion means some of the value will not be considered when your tax bill is created. If you do not qualify for the program in future years, the excluded value from prior years does not become taxable.
Once approved for the Elderly or Disabled Exclusion, you will receive a Requalification Letter each January that must be returned. Please answer the questions on the letter and return to us for processing. You will only lose your exclusion if you do not return your requalification letter, your permanent residence has changed, your income now exceeds the current annual income eligibility limit, or you are no longer totally and permanently disabled. If the person receiving the exclusion last year deceased prior to January 1, the person required by law to list the property must notify the Franklin County Tax Assessor's Office. The surviving spouse or joint property owner is required to reapply for the exclusion if qualified. Failure to make any of these notices before June 1 will result in penalties, interest, and the possible loss of the exclusion.
Disabled Veteran Exclusion
Honorably discharged disabled veterans or their unmarried surviving spouses may be eligible for a reduction in property tax. The disabled veteran must be 100% totally and permanently disabled due to a service-related injury. There is no age or income limitation on this program.
This program excludes up to the first $45,000 of the assessed value of the permanent residence of an honorably discharged veteran who has a total and permanent disability that is service-related or who received benefits for specially adapted housing under 38 U.S.C. 2101. Unmarried joint property owners must apply separately and benefit limitations may apply based on the percentage of ownership. If eligible, each owner may receive benefits under either the Elderly or Disabled Exclusion or the Disabled Veteran Exclusion. Once approved for the Disabled Veteran Exclusion, you do not need to reapply unless your disability or benefit status has changed.
Circuit Breaker Tax Deferment Program
Applicants must be 65 years of age or totally and permanently disabled. The previous year's total income for both an applicant and spouse cannot exceed $44,250. For unmarried joint property owners, each owner must apply and qualify separately. In addition, all owners must have owned and occupied the residence for the previous five years.
For an owner whose income does not exceed $29,500, the owner's taxes will be limited to 4% of their income. For an owner, whose income exceeds $29,500 but does not exceed $44,250, the owner's taxes will be limited to 5% of their income. Participation in this program requires all owners to apply and qualify. In this program, deferred taxes become a lien on the property, and interest accrues on the deferred taxes from the date they were originally due. Disqualifying events that trigger a rollback in taxes include the death of the owner, transfer of the property, and the owner ceasing to use the property as a permanent residence. Rollback taxes include the preceding 3 years' of deferred taxes plus the accrued interest. An application for the Circuit Breaker Tax Deferment Program must be filed each year in order to stay in the program.
Separate applications are required for each owner that is claiming property tax relief. If a husband and wife are the sole owners of the property, only one application is required. Each owner may receive benefits from only one of these programs even though they may meet the requirements for more than one.
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