In Washington, D.C. home buyers who qualify can have their annual property tax payments abated for up to five (5) years! In order to qualify for the The Lower Income Homeownership Exemption program, your income must fall under the household income limits (see table below) and this applies against all person(s) in the household. The purchase price of the property shall not exceed $479,066. Any buyer of a principal residence who qualifies is eligible.
*Here’s the math: $465,600 purchase price — $75,700 homestead deduction = $389,900 taxable assessment X ¢.085/$100 of taxable assessment = $3,314.15 annual tax savings. The program also allows for higher household income thresholds in DC Economic Development Zones.
In D.C., property taxes are calculated based on the property’s assessed value and not the purchase price, but these are often similar. Homes that are the owners’ principal residence get a Homestead Deduction in D.C. that amounts to a $75,700 reduction in the property’s assessed value.
With a purchase price at the region’s median sales price of $465,000, this amounts to significant savings and over the the five year span of the program. The Title Company involved will assist buyers in submitting the application to the D.C. Government at the closing.
When home buyers know the programs that are available to them they can make better choices and that is what this blog and these resources are all about.
Want to learn more about other tips for home buyers? Or want to learn more about the home-buying process? Check out our Home Buyer Tips Blog.
