Property Tax And Rent Relief
Older Iowans or those with a disability may be eligible for property tax or rent reimbursement for their homes. For specific questions about property tax relief, contact your county treasurer. For questions about rent reimbursement, contact the Iowa Department of Health and Human Services (HHS).
Homestead Tax Credit
Most homeowners qualify for a homestead tax credit to lower the property taxes on their homes, regardless of age. To qualify, the homeowner must file a verified statement and designation of homestead with the county tax assessor by July 1 of the year in which the credit will first be claimed. If the homeowner lives on the property on July 1st of each year and for at least six months of each year, the credit will continue without refiling every year, until the property is sold or until the owner no longer qualifies. A homestead is defined as the dwelling owned and actually occupied by the person filing for the credit. The credit is also available to certain persons confined to a nursing home, extended-care facility, or hospital and to persons residing in mobile, manufactured, and modular homes. The application is available at https://tax.iowa.gov/tax-credits-and-exemptions.
Property Tax Credit
In addition to the homestead tax credit, individuals may be eligible for a property tax credit if they are age 65 or older (by December 31 of the year preceding the year in which the claim is filed) or are totally disabled and at least eighteen years old. A person must also be a year-round Iowa resident and have a fairly low annual household income. The credit is also available to persons residing in mobile, manufactured, and modular homes if the home is taxed as real estate. If it is not taxed as real estate, an owner may claim a credit on the property where the home is located, assuming that the owner of the home also owns the land on which the home is located. You must file an application with your county treasurer for the property tax credit between January 1 and June 1 of each year. Procedures do exist, however, for requesting an extension for filing. The form is available at https://tax.iowa.gov/tax-credits-and-exemptions.
Rent Reimbursement
Iowa’s rent reimbursement program entitles Iowans who are age 65 or older or disabled or 18 years of age or older, who rent a house, apartment, or a mobile home lot of one acre or less, and in some cases those who reside in a nursing home or extended care facility, to reimbursement of up to $1,000 of the rent they paid in the year before they filed their application. The precise amount of reimbursement is calculated according to a formula and the amount changes each year. Persons are eligible only if the place they rent or the nursing home in which they live is subject to property tax. If you are uncertain about the tax status of the place you rent, ask your landlord or the city or county assessor. For nursing homes, this means that it must be operated for profit. You must file an application with the Iowa Department of Health and Human Services for the rent reimbursement program between January 1 and June 1 of each year. Procedures do exist, however, for requesting an extension for filing. The application is online at https://hhs.iowa.gov/rent-reimbursement.
The definition of income for both the property tax credit and rent reimbursement programs is very broad. Income includes such things as wages, salaries, tips, in-kind assistance (i.e., housing and utility expenses paid for you, except Federal Energy Assistance), rent subsidies, utilities assistance, Title 19/Medicaid benefits, social security income, disability compensation, pensions and annuities, interest and dividend income, profit from business and/or farming, capital gains, monetary contributions, child support, alimony, welfare payments (not including food stamps or other non-cash government benefits such as clothes, food, medical supplies, etc.), and insurance income.
Property Tax Suspension And Abatement
Iowans who get Supplemental Security Income (SSI), or State Supplemental Assistance (SSA), or live in a health care facility which is receiving payment from the Department of Health and Human Services for the person’s care, can get their property taxes suspended. The suspension lasts until the property is sold or transferred to someone else, or until the person no longer receives SSI, SSA, or assistance for living in a healthcare facility. To prove eligibility for the suspension, you should get a Notice of Decision from the Iowa Department of Health and Human Services that will say that you are eligible for property tax suspension. Take the Notice of Decision to your county board of supervisors and the board will order the county treasurer to suspend your taxes. Other people with low incomes can request that the board of supervisors suspend their property taxes if they can prove that they are unable to pay their taxes. The board has the discretion to grant or deny the request. If people who receive a tax suspension also qualify for the elderly and disabled property tax credit, they should apply for both the credit and suspension since the credit will completely eliminate part of their tax liability, while a suspension merely delays payment.
Warning: People who have a mortgage or reverse mortgage on their home should probably not ask for a suspension of the property taxes. A suspension would probably violate the terms of the mortgage and could result in foreclosure.
The county board of supervisors can also decide to abate the property taxes of someone whose property taxes have been suspended. Abating the taxes means to completely cancel the taxes owed. The board can abate taxes if canceling the payment of taxes is in the best interests of the public and the person making the request.