In Idaho, each owner-occupied primary residence (house or manufactured home) and up to one acre of land is eligible for a homeowner's exemption. Instead of calculating your property tax percentage based on the full value of your home, the Idaho Homeowner’s Exemption subtracts $100,000 and determines your tax rate based on the resulting amount.
Changes in the Law. Previously a homeowner had to occupy the residence and file the homeowner’s exemption application prior to April 15 to obtain the homeowner’s exemption for the year. Effective January 1, 2021, the April 15 date for filing a homeowner’s exemption is removed. Beginning January 1, 2021, a homeowner can apply and receive the homeowner’s exemption at any point in the year. The exemption will become effective upon the date of the application. It is recommended that homeowners that qualify for the exemption file their application in a timely manner to ensure they receive the maximum benefit under the exemption.
Property Tax Reduction Program. The Property Tax Reduction (Circuit Breaker) program reduces property taxes for qualified applicants. The reduction amount is based on an individual’s income for the previous year. The maximum possible reduction amount on a residence and up to one acre of land is $1,320. In order to qualify for the property tax reduction in 2021 you must meeting the following requirements: (a) owned and lived in a home or mobile home in Idaho as your primary residence before April 15, 2021; (b) have income of $31,900 or less for 2020; and (c) be one of the following:
· age 65 or older;
· a widow(er);
· blind;
· a minor with no parents;
· a former prisoner of war;
· a veteran (that meets certain qualifications); or
· disabled.
For more information on the Property Tax Reduction program and to apply it is necessary to contact your county assessor’s office for application materials.
3. Homeowner’s Exemption Available for Entity Ownership. The homeowner’s
exemption is still available if a primary residence is owned by an entity. Pursuant to
Idaho Code § 63-701(7) an “owner” for homeowner’s exemption purposes shall
include any person who is: (a) the beneficiary of a revocable or irrevocable trust
which is the owner of such homestead and under which the claimant or the
claimant’s spouse has the primary right of occupancy of the homestead; or (b) is a
partner of a limited partnership, member of a limited liability company or
shareholder of a corporation if such entity holds title in fee simple or holds a
certificate of motor vehicle title and if the person holds at least a five percent (5%)
ownership in such entity, as determined by the county assessor; or (c) has retained
or been granted a life estate. The person applying for the homeowner’s exemption
will need to file a necessary affidavit with the applicable county assessor with
supporting documents along with the homeowner’s exemption application. For an
illustration of how this works let us assume a couple owns multiple real properties
in their revocable living trust. The couple may apply and retain the homeowner’s
exemption for their principal residence by submitting an application and filing an
affidavit regarding residence of trust with their county assessor’s office. The couple
also has an adult child that lives in a separate real property held in the couple’s
trust. If the adult child is a beneficiary of the couple’s trust and the real property is
the child’s primary residence, the child can apply for the homeowner’s exemption as
a beneficiary of the couple’s trust. The child would receive the homeowner’s
exemption on his or her principal residence as well even though it is owned in the
parent’s trust.
This article is not intended to replace legal advice applicable to your situation and should be used only for informational purposes. Consult with your legal or tax advisors before implementing any suggestion contained herein.
Kimberly Soyer is an associate attorney with the firm of Sandra L. Clapp & Associates, P.A. and can be reached at ksoyer@clapp-legal.com or (208) 938-2660