Are You Getting All Your North Carolina Property Tax Breaks?

Whether you live in the Appalachian Mountains, the Piedmont Plateau, or the Tidewater area of North Carolina, there's no escaping local property taxes. Under North Carolina Gen. Stat. § 105-289, individual counties in North Carolina have the power to manage and collect those taxes. Of course, like any homeowner, you want to make sure that you are not overpaying.

Fortunately, there might be ways to lower your property tax burden, including:

• appealing the valuation of your property (available to all North Carolina homeowners), and
• checking whether you meet certain qualifications under your local tax code, for example for elderly and disabled low-income residents.

If you qualify, you can seek tax relief using both these methods.

Appeal the Taxable Value of Your North Carolina Home

You might know that the North Carolina authorities compute your property tax by multiplying your home's taxable value by the applicable tax rate.

Consider this example. Dennis and Margaret own a home in North Carolina. The assessor has placed a taxable value of $200,000 on it. If the property tax rate is 1% in their county (it's ordinarily slightly less), Dennis and Margaret will owe $2,000 in property tax. However, based on research into assessed property values in their area, they appeal the $200,000 figure. The appeals board reduces their assessed value to $150,000. Now, they owe only $1,500 in annual property tax on their North Carolina home.

Sometimes, a county assessor might wrongly believe that a home is larger than it is, or be unaware of damage (such as defective roofing or leaky pipes) that reduces its value. Or perhaps the assessor ignored the value of similar homes in the area in overvaluing yours.

If you believe that the tax assessor has misjudged the value of your property, or if the taxable value is higher than that of similar homes and properties, you might wish to pursue an appeal.

Claim All North Carolina Tax Breaks to Which You're Entitled

North Carolina allows for reduced property taxes if homeowners meet certain requirements. Below is a summary of the chief programs in North Carolina. See also North Carolina Gen. Stat § 105-277.

Homestead exclusion for elderly or disabled. If you are 65 years old or older, or you are permanently disabled, you are eligible for a partial exemption worth a minimum of $25,000, with annual adjustments for inflation. But you qualify only if your income is below a certain level.

Circuit breaker tax deferral for elderly and disabled. Some North Carolina homeowners are eligible for a property tax deferment program. It places a ceiling on how much tax the owners must pay. The tax amount above the ceiling is deferred until a disqualifying event occurs—typically when the home changes hands. To get this tax break, you must be 65 years old or older and permanently and totally disabled. In addition, you must have lived in the home for at least five years, and have income below a designated level.

Homestead exclusion for disabled veterans. A $45,000 exemption is available to a disabled veteran, or surviving spouse (who has not remarried). The veteran must first be certified as being totally and permanently disabled because of military service. If you take this exemption, you can't receive any other property tax break.

For More Information on North Carolina Property Tax Law

Although North Carolina laws set statewide property tax rules, your local government handles the administration and levying of the tax. Contact your county tax assessor for complete details on how property tax exemptions apply in your county. Be sure to ask about any forms you need to complete, and the deadline for filing them. To find contact information for your county tax assessor, explore the North Carolina assessors list posted by the state's Department of Revenue.

In addition to the property tax that's based on the assessed value of your home, your tax bill might include special assessments. Typically these are made to pay for improvements, such as street paving or repaving, in your neighborhood.

Depending on the complexity of your situation, you might want to seek legal help to reduce your North Carolina property tax.