"Property tax deferral offers seniors a way to manage their finances more effectively. By postponing property tax payments, seniors can allocate their limited resources to other essential expenses like healthcare, daily living costs, and maintaining their homes." - Logan Hassinger, Sage Senior Support

Senior Property Tax Deferral: A Guide to Lowering Living Expenses

Introduction:

As seniors approach their retirement years, managing living expenses becomes a paramount concern. One often-overlooked avenue for financial relief is property tax deferral, a program that allows eligible seniors to postpone paying property taxes, providing crucial financial breathing room during a stage of life when fixed incomes can be stretched thin. In this article, we'll delve into the concept of property tax deferral for seniors, explore its benefits, and provide insights into important considerations before filing for deferral. Senior Property Tax Deferral: A Guide to Lowering Living Expenses.

Understanding Property Tax Deferral

Property tax deferral is a government-sponsored program designed to assist seniors who are experiencing financial constraints in paying their property taxes. The program enables eligible seniors to delay making property tax payments until a later date, typically when the property changes ownership or the homeowner passes away. The deferred taxes, along with any accrued interest, are then repaid from the proceeds of the property's sale.

Eligibility Criteria

The eligibility criteria for property tax deferral programs vary from state to state and even from municipality to municipality. However, common eligibility factors include age, income level, and the homeowner's primary residence status. Seniors interested in property tax deferral should investigate the specific requirements of their jurisdiction to determine their eligibility. The application from the Texas Comptroller of Public Accounts can be found here. Once on the "Property Tax Forms" page, you'll click on "Collection Forms" and then the form "50-126, Tax Deferral Affidavit for Age 65 or Older or Disabled Homeowner". After completing the form, you'll then need to contact your county's appraisal district to file it.

Benefits for Seniors

1. Financial Flexibility: Property tax deferral offers seniors a way to manage their finances more effectively. By postponing property tax payments, seniors can allocate their limited resources to other essential expenses like healthcare, daily living costs, and maintaining their homes.

2. Stability in Retirement: Living on a fixed income can be challenging, especially when unexpected expenses arise. Property tax deferral helps seniors stabilize their financial situation by giving them the option to delay a significant expense and maintain a consistent standard of living.

3. Avoiding Displacement: For many seniors, their homes hold immense sentimental value, often serving as the backdrop to cherished memories. Property tax deferral can prevent seniors from being forced to sell their homes due to an inability to keep up with tax payments, allowing them to age in place comfortably.

Important Considerations Before Filing for Deferral

Before proceeding with a property tax deferral, here are some crucial facts to consider:

• Mortgage Company Communication: If you currently have a mortgage company, it's essential to contact them to confirm whether they will honor the tax deferral. Some mortgage companies may not accept deferrals and require property taxes to be paid in full each year.

• Tax Lien and Accrued Interest: It's important to note that a tax lien will remain on the property, and interest will accrue. The rate of interest accrual varies, being 8% per year before January 1, 2018, and 5% per year on or after January 1, 2018. Delinquent penalties, interest, or attorney fees that were imposed on the property prior to filing the deferral affidavit will remain due.

• Immediate Status Change: Individuals should be aware that deferral status changes immediately upon the sale or change of ownership of the property. On the 181st day after the deferred status changes, standard penalties, interest, and attorney fees will be due for all years.

Conclusion

For seniors seeking ways to alleviate financial strain and secure their retirement years, property tax deferral is a viable solution. By postponing property tax payments until a later date, eligible seniors can enjoy increased financial flexibility, maintain their cherished homes, and experience greater stability during their retirement journey. Before proceeding, seniors should research their local deferral programs, seek professional advice, and make informed decisions that align with their unique financial situations. Understanding the implications and considering crucial factors will empower seniors to make the best choices for their financial well-being.

Contact Sage Senior Support today to learn more about this strategy and other ways to help age in place.