One of the things as Realtors that we need to do is stay current on the laws. The State of Maryland has just passed a great new law that will go into effect on October 1st.
There is a Homestead Property Tax Credit Program was created to give homeowners a little break against year over year large tax assessment increases. Technically, the Homestead Credit does not limit the market value of the property as determined by the Department of Assessments and Taxation. Instead, it is actually a credit calculated on any assessment increase exceeding 10% (or the lower cap enacted by the local governments) from one year to the next. The Maryland.Gov website gives a great example to explain it:
Example:
Assume that your old assessment was $100,000 and that your new phased-in assessment for the 1st year is $120,000. An increase of 10% would result in an assessment of $110,000. The difference between $120,000 and $110,000 is $10,000. The tax credit would apply to the taxes due on the $10,000. If the tax rate was $1.04 per $100 of assessed value, the tax credit would be $104 ($10,000 ÷ 100 x $1.04).
Clear as mud right? In my opinion, any credit is money in your pocket, so you might as well apply for it. But there's rules on your eligibility. You have to live in the home, not change it's usage (like from being a residence to become a business), or transfer ownership.
The new law that was just passed by the State of Maryland said that the State needs to identify the homeowners that may be eligible for the credit, but haven't applied for it yet. The law says the State will begin notifying those individuals with an insert that would go out with their property assessment saying they may be eligible, and how to apply for the credit. It goes into affect October 1st.
By the way, when I was looking up the details of the law, I saw this beautiful picture of the State House on the Maryland site. Isn't it beautiful?
If you have any questions about the Homestead Property Tax Credit Program, please ask! I'll be glad to help you understand it!
There is a Homestead Property Tax Credit Program was created to give homeowners a little break against year over year large tax assessment increases. Technically, the Homestead Credit does not limit the market value of the property as determined by the Department of Assessments and Taxation. Instead, it is actually a credit calculated on any assessment increase exceeding 10% (or the lower cap enacted by the local governments) from one year to the next. The Maryland.Gov website gives a great example to explain it:
Example:
Assume that your old assessment was $100,000 and that your new phased-in assessment for the 1st year is $120,000. An increase of 10% would result in an assessment of $110,000. The difference between $120,000 and $110,000 is $10,000. The tax credit would apply to the taxes due on the $10,000. If the tax rate was $1.04 per $100 of assessed value, the tax credit would be $104 ($10,000 ÷ 100 x $1.04).
Clear as mud right? In my opinion, any credit is money in your pocket, so you might as well apply for it. But there's rules on your eligibility. You have to live in the home, not change it's usage (like from being a residence to become a business), or transfer ownership.
The new law that was just passed by the State of Maryland said that the State needs to identify the homeowners that may be eligible for the credit, but haven't applied for it yet. The law says the State will begin notifying those individuals with an insert that would go out with their property assessment saying they may be eligible, and how to apply for the credit. It goes into affect October 1st.
By the way, when I was looking up the details of the law, I saw this beautiful picture of the State House on the Maryland site. Isn't it beautiful?
If you have any questions about the Homestead Property Tax Credit Program, please ask! I'll be glad to help you understand it!
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