Good News for Maryland Homeowners

Good news for Maryland homeowners looking for possible relief on their property tax bills. 

For some time now the Maryland State Department of Assessment and Taxation has no longer automatically credited homeowners the Homestead Credit as seen on previous tax bills. The homestead credit used to be a standard credit to all owner-occupied residents in Maryland, however, due to the housing market downturn and lost Maryland State reviews, this policy changed. The changes actually went into effect as of 2008, but most homeowners are still not aware they are able to reinstate this credit and save big money off their property tax bills for their existing homes.

The Homestead Credit limits the increase in taxable assessments each year to a fixed percentage. Every county and municipality in Maryland is required to limit taxable assessment increases to 10% or less each year. The homeowner pays no property tax on the market value increase which is above the limit.

The original goal of the Homestead Credit Legislation was to help homeowners deal with large assessment increases on their principal residence. This is a quite an important step to take at a time when homeowner’s are struggling to make ends meet. With high unemployment, declining home prices, and household expenses, even a few hundred dollars a year can mean the difference to local families

The Homestead Credit Legislation does set out certain rules to ensure no homeowner incorrectly receives the credit. This credit isn’t available on rented or multiple properties of a single owner, and a new amendment enacted in 2007 requires all homeowners to submit a one-time application to establish eligibility for the credit.

The application form is automatically mailed to new purchasers of residential property with their first assessment. Current homeowners were mailed a copy at the end of December as part of three different mailing groups over 2008-2010.  

Didn’t get a copy? I did you throw it out as “Junk Mail”?

Homeowners now have to apply in person, via mail, or online. I encourage all homeowner’s to fill out this one time Homestead Credit Application as soon as possible.

If you have been denied a Homestead Tax Credit and you believe that you are eligible, contact the Central Office for the Homestead Tax Credit Program. A final denial of a Homestead Tax Credit by the Central Office may be appealed within 30 days to the Property Tax Assessment Appeal Board in the jurisdiction where the property is located.

For questions about the Homestead Tax Credit in Maryland check out the Homestead Department’s website.