Property Tax Exemptions in Nebraska

Property taxes in Nebraska are high compared to other states. According to the Tax Foundation, Nebraska ranked 5th among the states in 2009 in terms of taxes as a percentage of median home value at 1.76%. There are certain homestead exemptions that can reduce the tax burden. The categories of homestead exemptions include homeowners age 65 or older, disabled homeowners, and totally disabled wartime veterans and surviving spouses of veterans.

According to the Nebraska Department of Revenue, the homestead exemption applies to your residence and up to one acre of surrounding land. If you are age 65 or older, to qualify for the homestead exemption you must own and occupy the home from January 1 through August 15. To be eligible for the homestead exemption, your home must have an assessed value of not more than $95,000 or 200% of the average assessed value in your county, whichever is greater. If the assessed value of your home is more than that amount, the exempt value is reduced by 10% for every $2,500 over the maximum amount. If the assessed value is more than $20,000 higher than the maximum value, you are not eligible for the homestead exemption.

There are income limits depending on whether you are single or married. The maximum income is $31,801 if you are single and $38,401 if married. The percentage relief is progressive depending on your level of income, with 100% applicable up to a household income of $25,201 if you are single and $29,501 if married.

As pointed out in an article for AARP, homeowners whose income is above the limit for the exemption may find they qualify after deducting their health care costs. The household income for purposes of determining eligibility for the homestead exemption is calculated on Form 458 '" Schedule I '" Nebraska Schedule I '" Income Statement. This schedule is attached to Form 458 - Nebraska Homestead Exemption Application or Certification of Status. You must file your application for the homestead exemption with your county assessor between February 1 and June 30.

The disability homestead exemption applies to homeowners who cannot walk without the use of a mechanical aid or prosthesis, who have undergone amputation of both arms above the elbow, or who have a permanent partial disability of more than 75 percent in both arms. Disabled homeowners must own and occupy the home from January 1 through August 15. The household income limits for disabled homeowners are $34,901 if single and $40,301 if married.

Wartime veterans can qualify for the homestead exemption if they have a 100% disability that is service related or if they are totally disabled due to an illness or accident not related to their service. The period of ownership and occupancy and the income limits are the same as for other disabled homeowners. The homestead of a veteran who has a home that is substantially contributed to by the Department of Veterans Affairs is 100% exempt, regardless of the value of the homestead and the veteran's income level.

Surviving spouses of veterans can also qualify for the homestead exemption if they have not remarried. This includes surviving spouses of veterans who died due to a service-connected disability, service members who died while on active duty in connection with their service or during wartime, and veterans who received compensation from the Department of Veterans Affairs for a 100% disability connected with their service.

Sources:
Form 458 - Nebraska Homestead Exemption Application or Certification of Status
Form 458 '" Schedule I '" Nebraska Schedule I '" Income Statement
Nebraska Homestead Exemption '" Nebraska Department of Revenue
Nebraska's Homestead Exemption Eases Property Tax Burden - AARP
Property Taxes on Owner-Occupied Housing by State, 2004 '" 2009 '" Tax Foundation