§ 105-277.1. (Effective for taxes imposed for taxable years beginning before July 1, 2009) Property tax homestead exclusion. - North Carolina Statutes

§ 105‑277.1.  (Effectivefor taxes imposed for taxable years beginning before July 1, 2009) Property taxhomestead exclusion.

(a)        (Effective fortaxes imposed for taxable years beginning before July 1, 2008) Exclusion. –A permanent residence owned and occupied by a qualifying owner is designated aspecial class of property under Article V, Sec. 2(2) of the North CarolinaConstitution and is taxable in accordance with this section. The amount of theappraised value of the residence equal to the exclusion amount is excluded fromtaxation. The exclusion amount is the greater of twenty thousand dollars($20,000) or fifty percent (50%) of the appraised value of the residence. Aqualifying owner is an owner who meets all of the following requirements as ofJanuary 1 preceding the taxable year for which the benefit is claimed:

(1)        Is at least 65 yearsof age or totally and permanently disabled.

(2)        Has an income forthe preceding calendar year of not more than the income eligibility limit.

(3)        Is a North Carolinaresident.

(a)        (Effective fortaxes imposed for taxable years beginning on or after July 1, 2008 and beforeJuly 1, 2009) Exclusion. – A permanent residence owned and occupied by aqualifying owner is designated a special class of property under Article V, Sec.2(2) of the North Carolina Constitution and is taxable in accordance with thissection. The amount of the appraised value of the residence equal to theexclusion amount is excluded from taxation. The exclusion amount is the greaterof twenty‑five thousand dollars ($25,000) or fifty percent (50%) of theappraised value of the residence. A qualifying owner is an owner who meets allof the following requirements as of January 1 preceding the taxable year forwhich the benefit is claimed:

(1)        Is at least 65 yearsof age or totally and permanently disabled.

(2)        Has an income forthe preceding calendar year of not more than the income eligibility limit.

(3)        Is a North Carolinaresident.

(a1)      Temporary Absence. –An otherwise qualifying owner does not lose the benefit of this exclusionbecause of a temporary absence from his or her permanent residence for reasonsof health, or because of an extended absence while confined to a rest home ornursing home, so long as the residence is unoccupied or occupied by the owner'sspouse or other dependent.

(a2)      (Effective fortaxes imposed for taxable years beginning before July 1, 2008) IncomeEligibility Limit. – Until July 1, 2003, the income eligibility limit iseighteen thousand dollars ($18,000). For taxable years beginning on or afterJuly 1, 2003, the income eligibility limit is the amount for the precedingyear, adjusted by the same percentage of this amount as the percentage of anycost‑of‑living adjustment made to the benefits under Titles II andXVI of the Social Security Act for the preceding calendar year, rounded to thenearest one hundred dollars ($100.00). On or before July 1 of each year, theDepartment of Revenue must determine the income eligibility amount to be ineffect for the taxable year beginning the following July 1 and must notify theassessor of each county of the amount to be in effect for that taxable year.

(a2)      (Effective fortaxes imposed for taxable years beginning on or after July 1, 2008 and beforeJuly 1, 2009) Income Eligibility Limit. – For the taxable year beginning onJuly 1, 2008, the income eligibility limit is twenty‑five thousanddollars ($25,000). For taxable years beginning on or after July 1, 2009, theincome eligibility limit is the amount for the preceding year, adjusted by thesame percentage of this amount as the percentage of any cost‑of‑livingadjustment made to the benefits under Titles II and XVI of the Social SecurityAct for the preceding calendar year, rounded to the nearest one hundred dollars($100.00). On or before July 1 of each year, the Department of Revenue mustdetermine the income eligibility amount to be in effect for the taxable yearbeginning the following July 1 and must notify the assessor of each county ofthe amount to be in effect for that taxable year.

(b)        Definitions. – Thefollowing definitions apply in this section:

(1)        Code. – The InternalRevenue Code, as defined in G.S. 105‑228.90.

(1a)      (Effective fortaxes imposed for taxable years beginning before July 1, 2008) Income. – Adjustedgross income, as defined in section 62 of the Code, plus all other moneysreceived from every source other than gifts or inheritances received from aspouse, lineal ancestor, or lineal descendant. For married applicants residingwith their spouses, the income of both spouses must be included, whether or notthe property is in both names.

(1a)      (Effective fortaxes imposed for taxable years beginning on or after July 1, 2008 and beforeJuly 1, 2009) Income. – All moneys received from every source other thangifts or inheritances received from a spouse, lineal ancestor, or linealdescendant. For married applicants residing with their spouses, the income ofboth spouses must be included, whether or not the property is in both names.

(1b)      Owner. – A person whoholds legal or equitable title, whether individually, as a tenant by theentirety, a joint tenant, or a tenant in common, or as the holder of a lifeestate or an estate for the life of another. A manufactured home jointly ownedby husband and wife is considered property held by the entirety.

(2)        Repealed by SessionLaws 1993, c. 360, s. 1.

(2a)      Repealed by SessionLaws 1985 (Reg. Sess., 1986), c. 982, s. 20.

(3)        Permanent residence.– A person's legal residence. It includes the dwelling, the dwelling site, notto exceed one acre, and related improvements. The dwelling may be a singlefamily residence, a unit in a multi‑family residential complex, or amanufactured home.

(4)        Totally andpermanently disabled. – A person is totally and permanently disabled if theperson has a physical or mental impairment that substantially precludes him orher from obtaining gainful employment and appears reasonably certain tocontinue without substantial improvement throughout his or her life.

(c)        Application. – Anapplication for the exclusion provided by this section should be filed duringthe regular listing period, but may be filed and must be accepted at any timeup to and through June 1 preceding the tax year for which the exclusion isclaimed. When property is owned by two or more persons other than husband andwife and one or more of them qualifies for this exclusion, each owner mustapply separately for his or her proportionate share of the exclusion.

(1)        Elderly Applicants.– Persons 65 years of age or older may apply for this exclusion by entering theappropriate information on a form made available by the assessor under G.S. 105‑282.1.

(2)        Disabled Applicants.– Persons who are totally and permanently disabled may apply for this exclusionby (i) entering the appropriate information on a form made available by theassessor under G.S. 105‑282.1 and (ii) furnishing acceptable proof oftheir disability. The proof must be in the form of a certificate from aphysician licensed to practice medicine in North Carolina or from agovernmental agency authorized to determine qualification for disabilitybenefits. After a disabled applicant has qualified for this classification, theapplicant is not required to furnish an additional certificate unless theapplicant's disability is reduced to the extent that the applicant could nolonger be certified for the taxation at reduced valuation.

(d)        Multiple Ownership.– A permanent residence owned and occupied by husband and wife as tenants bythe entirety is entitled to the full benefit of this exclusion notwithstandingthat only one of them meets the age or disability requirements of this section.When a permanent residence is owned and occupied by two or more persons otherthan husband and wife and one or more of the owners qualifies for thisexclusion, each qualifying owner is entitled to the full amount of theexclusion not to exceed his or her proportionate share of the valuation of theproperty. No part of an exclusion available to one co‑owner may beclaimed by any other co‑owner and in no event may the total exclusionallowed for a permanent residence exceed the exclusion amount provided in thissection.  (1971,c. 932, s. 1; 1973, c. 448, s. 1; 1975, c. 881, s. 2; 1977, c. 666, s. 1; 1979,c. 356, s. 1; c. 846, s. 1; 1981, c. 54, s. 1; c. 1052, s. 1; 1985, c. 656, ss.44, 45; 1985 (Reg. Sess., 1986), c. 982, ss. 19, 20; 1987, c. 45, s. 1; 1993,c. 360, s. 1; 1996, 2nd Ex. Sess., c. 18, s. 15.1(a); 2001‑308, s. 1;2007‑484, s. 43.7T(a); 2007‑497, s. 1.1; 2008‑35, s. 3.)

§ 105‑277.1.  (Effectivefor taxes imposed for taxable years beginning on or after July 1, 2009) Elderlyor disabled property tax homestead exclusion.

(a)        Exclusion. – Apermanent residence owned and occupied by a qualifying owner is designated aspecial class of property under Article V, Sec. 2(2) of the North CarolinaConstitution and is taxable in accordance with this section. The amount of theappraised value of the residence equal to the exclusion amount is excluded fromtaxation. The exclusion amount is the greater of twenty five thousand dollars($25,000) or fifty percent (50%) of the appraised value of the residence. Anowner who receives an exclusion under this section may not receive otherproperty tax relief.

A qualifying owner is an ownerwho meets all of the following requirements as of January 1 preceding thetaxable year for which the benefit is claimed:

(1)        Is at least 65 yearsof age or totally and permanently disabled.

(2)        Has an income forthe preceding calendar year of not more than the income eligibility limit.

(3)        Is a North Carolinaresident.

(a1)      Temporary Absence. –An otherwise qualifying owner does not lose the benefit of this exclusionbecause of a temporary absence from his or her permanent residence for reasonsof health, or because of an extended absence while confined to a rest home ornursing home, so long as the residence is unoccupied or occupied by the owner'sspouse or other dependent.

(a2)      Income EligibilityLimit. – For the taxable year beginning on July 1, 2008, the income eligibilitylimit is twenty‑five thousand dollars ($25,000). For taxable yearsbeginning on or after July 1, 2009, the income eligibility limit is the amountfor the preceding year, adjusted by the same percentage of this amount as thepercentage of any cost‑of‑living adjustment made to the benefitsunder Titles II and XVI of the Social Security Act for the preceding calendaryear, rounded to the nearest one hundred dollars ($100.00). On or before July 1of each year, the Department of Revenue must determine the income eligibilityamount to be in effect for the taxable year beginning the following July 1 andmust notify the assessor of each county of the amount to be in effect for thattaxable year.

(b)        Definitions. – Thefollowing definitions apply in this section:

(1)        Code. – The InternalRevenue Code, as defined in G.S. 105‑228.90.

(1a)      Income. – All moneysreceived from every source other than gifts or inheritances received from aspouse, lineal ancestor, or lineal descendant. For married applicants residingwith their spouses, the income of both spouses must be included, whether or notthe property is in both names.

(1b)      Owner. – A person whoholds legal or equitable title, whether individually, as a tenant by theentirety, a joint tenant, or a tenant in common, or as the holder of a lifeestate or an estate for the life of another. A manufactured home jointly ownedby husband and wife is considered property held by the entirety.

(2)        Repealed by SessionLaws 1993, c. 360, s. 1.

(2a)      Repealed by SessionLaws 1985 (Reg. Sess., 1986), c. 982, s. 20.

(3)        Permanent residence.– A person's legal residence. It includes the dwelling, the dwelling site, notto exceed one acre, and related improvements. The dwelling may be a singlefamily residence, a unit in a multi‑family residential complex, or amanufactured home.

(3a)      Property tax relief.– The property tax homestead exclusion provided in this section, the propertytax homestead circuit breaker provided in G.S. 105‑277.1B, or thedisabled veteran property tax homestead exclusion provided in G.S. 105‑277.1C.

(4)        Totally andpermanently disabled. – A person is totally and permanently disabled if theperson has a physical or mental impairment that substantially precludes him orher from obtaining gainful employment and appears reasonably certain to continuewithout substantial improvement throughout his or her life.

(c)        Application. – Anapplication for the exclusion provided by this section should be filed duringthe regular listing period, but may be filed and must be accepted at any timeup to and through June 1 preceding the tax year for which the exclusion isclaimed. When property is owned by two or more persons other than husband andwife and one or more of them qualifies for this exclusion, each owner mustapply separately for his or her proportionate share of the exclusion.

(1)        Elderly Applicants.– Persons 65 years of age or older may apply for this exclusion by entering theappropriate information on a form made available by the assessor under G.S. 105‑282.1.

(2)        Disabled Applicants.– Persons who are totally and permanently disabled may apply for this exclusionby (i) entering the appropriate information on a form made available by theassessor under G.S. 105‑282.1 and (ii) furnishing acceptable proof oftheir disability. The proof must be in the form of a certificate from aphysician licensed to practice medicine in North Carolina or from agovernmental agency authorized to determine qualification for disabilitybenefits. After a disabled applicant has qualified for this classification, theapplicant is not required to furnish an additional certificate unless theapplicant's disability is reduced to the extent that the applicant could nolonger be certified for the taxation at reduced valuation.

(d)        Ownership bySpouses. – A permanent residence owned and occupied by husband and wife isentitled to the full benefit of this exclusion notwithstanding that only one ofthem meets the age or disability requirements of this section.

(e)        Other MultipleOwners. –  This subsection applies to co‑owners who are not husband andwife. Each co‑owner of a permanent residence must apply separately forthe exclusion allowed under this section.

When one or more co‑ownersof a permanent residence qualify for the exclusion allowed under this sectionand none of the co‑owners qualifies for the exclusion allowed under G.S.105‑277.1C, each co‑owner is entitled to the full amount of theexclusion allowed under this section. The exclusion allowed to one co‑ownermay not exceed the co‑owner's proportionate share of the valuation of theproperty, and the amount of the exclusion allowed to all the co‑ownersmay not exceed the exclusion allowed under this section.

When one or more co‑ownersof a permanent residence qualify for the exclusion allowed under this sectionand one or more of the co‑owners qualify for the exclusion allowed underG.S. 105‑277.1C, each co‑owner who qualifies for the exclusionunder this section is entitled to the full amount of the exclusion. Theexclusion allowed to one co‑owner may not exceed the co‑owner'sproportionate share of the valuation of the property, and the amount of theexclusion allowed to all the co‑owners may not exceed the greater of theexclusion allowed under this section and the exclusion allowed under G.S. 105‑277.1C. (1971, c. 932, s. 1; 1973,c. 448, s. 1; 1975, c. 881, s. 2; 1977, c. 666, s. 1; 1979, c. 356, s. 1; c.846, s. 1; 1981, c. 54, s. 1; c. 1052, s. 1; 1985, c. 656, ss. 44, 45; 1985(Reg. Sess., 1986), c. 982, ss. 19, 20; 1987, c. 45, s. 1; 1993, c. 360, s. 1;1996, 2nd Ex. Sess., c. 18, s. 15.1(a); 2001‑308, s. 1; 2007‑484,s. 43.7T(a), (b); 2007‑497, ss. 1.1, 2.1, 2.2; 2008‑35, s. 3; 2008‑107,s. 28.11(c)‑(f), (i); 2009‑445, s. 22(a).)