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Changes to Homestead Exemption Laws

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Changes to Homestead Exemption Laws


Homestead exemption was originally introduced in 1970 as a reduction in property taxes for lower income senior citizens.  Then, in 2007, the program was changed to include all homeowners 65 and older or permanently and totally disabled, without an income requirement.  Now, the State of Ohio is returning to the original practice, and will now be applying means/income testing to determine the eligibility of homeowners for homestead exemption.

Starting with the 2014 tax year, applicants for homestead exemption will be subject to an income/means test to determine their eligibility.  However, existing homestead exemption recipients will continue to receive property tax credit without being subject to such testing.

According to the Montgomery County Auditor, for a homeowner to qualify for the program, they must:

  • Own and occupy the home as their primary place of residence as of January 1 of the year for which they apply; and
  • Be 65 years of age, or turn 65, by December 31 of the year for which they apply; or Be totally and permanently disabled as of January 1 of the year for which they apply, as certified by a licensed physician or psychologist; or Be the surviving spouse of a person who was receiving the homestead exemption at the time of death and where the surviving spouse was at least 59 years old on the date of death.
  • Have a total income (for both the applicant and the applicant's spouse) that does not exceed the amount set by the law, which is adjusted annually for inflation.  "Total income" is defined as the adjusted gross income for Ohio income tax purposes.  The current maximum allowed is $30,500 for the 2014 application period.

Montgomery County also notes that the grandfather status is "portable", meaning that homeowners who received a homestead exemption credit for the 2013 tax year will not be subject to income/means testing even if they move to another Ohio residence.


Source of Information:  Montgomery County Auditor Office