Exemptions Cheryl Spraggins Georgia Department of Revenue

Homestead Exemption O.C.G.A State portion only $2,000 $4,000 $50,000 Varying 100% on 10 acres

Rules Real Property & Land surrounding Own on January 1 Permanent and Legal Residence Used as a dwelling Only one per family group Must file an application

Deadline for Filing Affective June 1, 2005 NO DEADLINE for Filing March 1 is deadline for receiving homestead Filing = year round Receiving = March 1

Example A. Purchase home on December 2005 B. File for Homestead on March 15, 2006 Will Receive homestead in what year? 2007 A. Purchase home on February 2006 B. File for Homestead on February 18, 2006 Will Receive homestead in what year? 2007

Example A. Purchase home on December 2005 B. File for Homestead on February 2006 Will Receive homestead in what year? 2006 A. Purchase home on December 2005 B. File for Homestead on October 2006 Will Receive homestead in what year? 2007

Designation of Returns (5) Tax Commissioner may give written authority for Tax Assessor to receive returns and/or homestead applications

Eligibility BOA makes determination of eligibility Written notice required for denial Taxpayer may appeal to BOE

How to Figure a Homestead Exemption [(40% * FMV) – 2,000] * millage rate 100,000 * 40% = 40,000 40,000 – 2,000 = 38,000 38,000 * = $950.00

How to Figure Tax Bill [(40% * FMV) – 2,000] * millage rate Less the HTRG 100,000 * 40% = 40,000 40,000 – 2,000 = 38,000 38,000 * = $ ,000 * = $200.00HTRG Total Tax Due = $750.00

New Elderly Exemption 10 acres and home 100% exempt State Taxes ONLY IN ADDITION TO 65 years of age

How to Figure New Elderly Over the Age of 65 Net Income of 50, acres of land and house FMV of house = 150,000 FMV of land = 75,000 Millage Rate State =.25 County = School = 19.00

How to Figure New Elderly FMV of house = 150,000 FMV of land = 75, ,000 x 40% = 60,000 75,000 / 15 = 5,000 an acre x 10 = 50,000 50,000 x 40% = 20,000 State Exemption = 50, , ,000 72, ,000 HTRG

How to Figure New Elderly State Portion 150, ,000 = 225, ,000 x 40% = 90,000 90,000 – 72,000 = 18,000 18,000 x = ,000 x = 2.00 Tax Due = 2.50

How to Figure New Elderly County Portion 90,000 – 2,000 = 88,000 x = ,000 x = Tax Due = School Portion 90,000 – 2,000 = 88,000 x.019 = ,000 x.019 = Tax Due =

StateCountySchool CodeType of ExemptionM&OBondM&OBond S1Regular2, SCAge % on 10 acres + 2,000 2,000 S3Elderly - Age 62 – Net Income less than $10,000 2, ,000 S4Elderly - Age 65 - Net Income less than $10,000 4,000 10,000 S5Disabled Veterans (2004Amount)50,000 SD Age % Disabled Veteran; Unremarried Surviving Spouse of Disabled Veteran 100% on 10 acres+ 50,000 50,000 SSSurviving Spouse of Disabled Veterans50,000 SE Age 65 - Unremarried Surviving Spouse of US Service Member killed in action 100% on 10 acres+ 50,000 50,000 SG Unremarried Surviving Spouse of a Firefighter or Peace Officer killed in the line of duty 100% S6Floating - Age 62 – Fed. A.G.I. less than 30,000 Varying 02,0000 S8Floating - Age 62 - Net Income less than 10,000 or Fed. A.G.I. less than 30,000 Varying 010,000 S9Floating - Age 65 - Net Income less than 10,000 or Fed. A.G.I. less than 30,000 Varying 4,00010,000

Forms Online at:

Regular (S1) $2,000 exemption from M & O State County School Form PL-66—Substitute new form State County School

New - SC O.C.G.A years of age and older on January 1 st 100% exemption on house and 10 acres State ONLY In addition to any other exemption No income information needed

$10,000 School Exemption A.K.A. (S3) Must be Age 62 on January 1 Must meet requirements for (S1) $10,000 Net Income (Applicant and Spouse) Applies to School M & O and Bond

$4,000 State and County Exemption A.K.A. (S4) Must be Age 65 on January 1 Must meet requirements for (S1) $10,000 Net Income (Applicant and Spouse) Applies to M & O and Bond on State County School = 10,000

Tax Returns Use most current tax information May require to prove income yearly General rule—elderly income decreases with age

Definition of GA Net Income Homestead Form may be used as Affidavit of Income Transfer information from Work Form to Homestead Form

Maximum Social Security $49, $50,784 should be used when determining the eligibility of any taxpayer seeking the elderly homestead exemptions afacts2006.htm

Calculation of Net Income Federal AGI From Form 1040:(A) ______________ (Adjusted Gross Income) 1040 – Line 35 or 1040EZ – Line 4 Deductions: Social SecurityLine 20b(B)_______________ Retirement IncomeLine 15b(C)_______________ Disability IncomeLine 16b(D)_______________ Total Deductions:(E)_______________ Maximum Social Security:(F)____50,784 _____ (For Taxpayer & Spouse) Reduction of AGI: lesser of line (E) or (F)(G)_______________ Itemized Deductions or Georgia Standard Deductions:(H)_______________ 1040 – Line 38 or 500 Line 12 for Itemized Deductions Standard Deductions = 2,300 for Single/HOH 3,000 for MFJ 1,500 for MFS 1,300 for Each Individual 651,300 for Each Individual Blind Personal Exemptions:(I)_______________ Number on 1040 – Line 6d or 500 – Line 7 multiplied by 2,700 Net Income for Exemption Purposes(J) _______________ (Line A minus G minus H minus I) Note: Other Income is derived from adding all other income on the 1040 form other than retirement or social security. Or you may subtract the figures in (B + C + D) from (A).

Calculation Continued Federal AGI From Form 1040:(A) _____$40,031_____ (Adjusted Gross Income) 1040 – Line 35 or 1040EZ – Line 4 Deductions: Social SecurityLine 20b(B)_____$ 1,790______ Retirement IncomeLine 15b(C)_________________ Disability IncomeLine 16b(D)_____$21,646______ Total Deductions:(E)______$23,436_____

Calculation Continued Total Deductions:(E)____$23,436______ Maximum Social Security:(F) $50,784_______ (For Taxpayer & Spouse) Reduction of AGI: lesser of line (E) or (F) (G)____$23,436______

Calculation Continued Itemized Deductions or Georgia Standard Deductions: (H)_____$3,000_____ 1040 – Line 38 or 500 Line 12 for Itemized Deductions Standard Deductions =2,300 for Single/HOH 3,000 for MFJ 1,500 for MFS 1,300 for Each Individual 65 1,300 for Each Individual Blind Personal Exemptions:(I)______$5,400_____ Number on 1040 – Line 6d or 500 – Line 7 multiplied by 2,700

Calculation Continued Federal AGI From Form 1040:(A) $40,031 (Adjusted Gross Income) 1040 – Line 35 or 1040EZ – Line 4 Reduction of AGI: lesser of line (E) or (F)(G) $23,436 Itemized Deductions or Georgia Standard Deductions: (H) $ 3,000 Personal Exemptions:(I) $ 5,400 Net Income for Exemption Purposes(J) $ 8,195 (Line A minus G minus H minus I)

Application Form SECTION C: 1. COMPLETE THIS SECTION TO DETERMINE ELIGIBILITY OF NET INCOME REQUIREMENT Column 1A Column 1B Applicant Only or Spouse Only INCOME FOR YEAR ENDING DECEMBER 31, 20____ Applicant & Spouse if if Tax Return Tax Return filed JointlyFiled Separately Line 1-Total Income from Public or Private retirement, disability or pension system Line 2-Total Income from Social Security Line 3-Total income from Retirement and Social Security (Line 1 plus Line 2) Line 4-Maximum Social Security amount (from Tax Receiver)-Cannot exceed Line 3 Line 5-Adjusted Income (Line 3 less Line 4) Line 6-Other Income from all sources Line 7-Adjusted Income (Line 5 plus Line 6) Line 8-Standard or Itemized Deductions from Georgia Income Tax Return Line 9-Personal exemption Amount from Georgia Income Tax Return Line 10-Net Income (Line 7 less Lines 8 & 9) If filing Jointly (Line 10, Column 1A) Must be < $10,000 If filing Separately (Total of Line 10, Columns 1A & 1B) Must be < $10,000

Application Form Continued SECTION C: 1. COMPLETE THIS SECTION TO DETERMINE ELIGIBILITY OF NET INCOME REQUIREMENT Column 1A Column 1B Applicant Only or Spouse Only INCOME FOR YEAR Applicant & Spouse if if Tax Return ENDING DECEMBER 31, 20____ Tax Return filed JointlyFiled Separately Line 1-Total Income from Public or Private retirement, disability or pension system21646 Line 2-Total Income from Social Security 1790 Line 3-Total income from Retirement and Social Security (Line 1 plus Line 2)23436

Application Form Continued Column 1A Column 1B Applicant Only or Spouse Only Applicant & Spouse if if Tax Return Tax Return filed Jointly Filed Separately Line 4-Maximum Social Security amount (from Tax Receiver)-Cannot exceed Line Line 5-Adjusted Income (Line 3 less Line 4) 0 Line 6-Other Income from all sources Line 7-Adjusted Income (Line 5 plus Line 6)16595

Application Form Continued Column 1A Column 1B Applicant Only or Spouse Only Applicant & Spouse if if Tax Return Tax Return filed Jointly Filed Separately Line 8-Standard or Itemized Deductions from Georgia Income Tax Return3000 Line 9-Personal exemption Amount from Georgia Income Tax Return5400 Line 10-Net Income (Line 7 less Lines 8 & 9)8195 If filing Jointly (Line 10, Column 1A) Must be < $10,000 If filing Separately (Total of Line 10, Columns 1A & 1B) Must be < $10,000

Exercises Spratts – Federal A.G.I. = 16, Net Income = 8, Eligible for elderly homestead Muffin – Federal A.G.I. = 42, Net Income = 11, Not Eligible Hubbard – Federal A.G.I. = 74, Net Income = 8, Eligible Coles – Federal A.G.I. = 190, Net Income = 57, Not Eligible Blue – Federal A.G.I. = 6, Net Income = Eligible Contrary – Federal A.G.I. = 12, Net Income = 6, Eligible

Disabled Veterans $50,000 Apply to M & O and Bond for State County School Qualifications Wartime Veteran – Totally Disabled Form DD #214 Letter from Doctor verifying disability

New - SD Must meet the requirements of S5 Disabled Veteran. Individuals 65 years of age and older on January 1 100% exemption on House and 10 acres State ONLY In addition to

Surviving Spouse (SS) Spouse killed in an armed conflict May not remarry $50,000 Applies to M & O and Bonds for State County School

New -- SE Must meet the requirements of SS Surviving Spouse 65 years of age and older 100% exemption on house and 10 acres State ONLY. In addition to

New -- SG Peace Officers and Fire Fighters 100% exemption from state, county, school, municipal, and bond taxes Unremarried surviving spouses In lieu of any existing exemptions

Floating Exemptions 62 years of age Appraised value should increase more than $5,000 to benefit Total household income not to exceed $30,000 Does not apply to municipal or school taxes.

Tax Deferrals 62 years of age Entitled to a homestead Total amount of taxes and interest and all other liens cannot exceed 85% of FMV Gross household income less than $15,000

Valuation Freeze Much like the floating homestead Locally Granted on County and/or School Only Does NOT affect State taxes FMV continues to increase Exemption increases yearly Valuation changes when sold

Freeport Exemptions Applies to State, County and School Percentage set by Governing Authority 20%, 40%, 50%, 80% or 100% Between And Percentage of Exemption Allowed March 2 March 31 9/12 or 75 per cent April 1 April 30 8/12 or 67 per cent May 1 May 31 7/12 or 58 per cent On June 1 N/A 6/12 or 50 per cent

Other Exemptions Rehabilitated Historic Property Landmark Historic Property Preferential Agricultural Property Conservation Use Property Environmentally Sensitive Property Tangible Personal Property

Exempt Property – Definitions Farm Equipment Autos – Computer software

Exempt Property Class CodeClass Name E0Non profit homes for the aged E1Public Property E2Places of religious worship E3Property used for charitable purposes E4Places of religious burial E5Charitable hospitals E6Educational Institutions E7Air and Water Pollution Equipment E8Farm Products in Hands of Producer E9Others