For many Colorado retirees, property taxes are one of the largest costs of staying in the home they love. As home values across the Denver metro have risen, so have property tax bills. Colorado offers a valuable program that can lower those bills for qualifying older homeowners: the senior property tax exemption.
Many eligible homeowners never apply, simply because they do not know the program exists or assume they will not qualify. Understanding the basics can help you or an aging parent keep more money in the household budget each year.
Who may qualify
In general, the exemption is available to Colorado homeowners who are at least 65 years old as of January 1 of the tax year and who have owned and lived in the home as their primary residence for at least ten consecutive years. The surviving spouse of a person who previously qualified may also be eligible in certain situations.
For qualifying homeowners, the exemption reduces the taxable value of the home by a set percentage of a portion of its actual value, with the state reimbursing local governments for the difference. A separate exemption is also available for qualifying veterans with a permanent and total service-connected disability. Because the details and limits can change, it is wise to review the current rules each year.
A simple application can lower your property tax bill year after year.
How to apply and plan ahead
Applications are filed with your county assessor, such as the Arapahoe County Assessor for many Aurora homeowners. There is generally an annual filing deadline in the summer, so check your county's date and gather proof of age, ownership and residence ahead of time. Once approved, the exemption usually continues in later years as long as you remain eligible.
Colorado also offers a property tax, rent and heat rebate program for qualifying older adults and people with disabilities who meet income limits. Homeowners and renters may both be eligible, so it is worth checking whether your household can benefit from more than one program.
If your mortgage includes an escrow account, a lower tax bill may reduce your monthly payment after the next escrow review. Put the savings to work by building your emergency fund, paying down debt or covering future healthcare costs in retirement.
The tax advisors at Finance Guide Flow help Aurora and Denver metro homeowners plan for property taxes and retirement expenses. Contact us for a free guidance session.