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File Now for Property Tax Relief

It’s no secret that Nebraska has one of the heaviest property tax burdens for people over age 65 in the nation.

For older homeowners who are struggling with high property taxes, the good news is that Nebraska’s homestead exemption may help them keep more cash in their pockets. This annual exemption excludes all or a portion of the value of a person’s home and up to one acre of land that the home is built on from property taxes. Low- and moderate-income older Nebraskans have until June 30 to apply.

Homeowners age 65 and over by Jan. 1, 2011, who have an income below $32,500 for an individual or $38,300 in combined income for a couple, may qualify for the homestead exemption. They must own and occupy their home from Jan. 1 through Aug. 15 each year to receive the tax relief.

Deduct medical expenses on the homestead application

Robert Courtney, volunteer statewide advocacy coordinator with AARP Nebraska, urges older Nebraskans to take a careful look at the property tax break.

“AARP is concerned that too many homeowners who qualify for a full or partial homestead exemption are not getting any help because they don’t think they are eligible. It’s definitely worth taking the time to find out,” he said.

Courtney explained that older homeowners are often surprised to find they can claim the homestead exemption once they add up their annual health care costs. As a general rule, a single person with an income around $37,000 or a married couple with an income around $47,000 may be eligible for relief after deducting medical expenses, including insurance premiums and out-of-pocket costs.

“If you think your income is too high, check again,” he cautioned. “If you spent more than four percent of your household income on health care, you can deduct most of those expenses and may meet income eligibility for the exemption.”

To calculate the deduction, multiply your income by 4 percent and subtract that number from total medical expense. That amount will be deducted from your income to determine whether you qualify for a property tax exemption.

All Social Security income must be included as income, including the non-taxable portion. Be careful not to double count taxable benefits.

Where to Get Help

Need help completing the application? Visit or call your County Assessor’s office. They can answer your questions and may be able to assist you with the paperwork. Or consider asking a family member or friend to help you with the application.

Volunteers at many AARP Tax Aide sites around the state also are trained to assist homeowners with the homestead exemption until April 15. Find a Tax-Aide site in your area online, or call toll free 1-888-687-2277.

For more information about the homestead exemption, including eligibility guidelines, see below.

Who is eligible?

Eligibility is based on your age, income and the value of your homestead. (Assets including cars and personal possessions such as furniture or jewelry are not counted).

If you are a homeowner age 65 and over by Jan. 1, 2011, and have an income below $32,501 for an individual or $38,301 in combined income for a couple, you may qualify for the homestead exemption. You must own and occupy your home from Jan. 1 through Aug. 15 each year to get the tax relief.

IMPORTANT: Persons under age 65 with disabilities and disabled veterans may also be eligible for the exemption, but different guidelines apply. Check with your County Assessor’s office for details.

What is the maximum value on the homestead to be eligible?

The maximum value of a homestead is $95,000 or 200 percent of the county’s average assessed value of single family residential property, whichever is greater. If the assessed value exceeds the maximum value by $20,000 or more, the homestead is not eligible for the exemption. Contact your County Assessor’s office for further information.

What medical expenses can I deduct from my income to qualify for the homestead exemption?

Medical expenses that are greater than four percent of your household income may be deducted in determining your eligibility for the exemption. You may deduct the cost of health insurance premiums, including Medicare Part B premiums and supplemental health insurance premiums; long-term care insurance premiums; the cost of goods and services from a licensed health practitioner or a licensed health facility; travel costs for out of town medical appointments, including hospital stays or to purchase drugs if you have no pharmacy in town; and the cost of insulin and prescription drugs. The cost of over-the-counter, non-prescription medicines cannot be deducted. To learn more about allowable deductions for medical expenses, contact your County Assessor’s office.

How and when do I file for the Homestead Exemption?

You must file for a homestead exemption after Feb. 1 and on or before June 30. Applications are available from your County Assessor’s office or you can find them online.

Where can I get more detailed information about the Homestead Exemption?

To learn more, contact your County Tax Assessor’s office or find more information online.