Big News for Idaho Homeowners: State Approves Property Tax Cuts
Come November, Idaho homeowners are in for a financial treat! Thanks to a new state law, residents will soon find out exactly how much they’ll save on their property taxes. But rather than keeping you in suspense, counties plan to roll out these details on the property tax notices they send by the fourth Monday in November.
Even Idaho’s property tax gurus are currently scratching their heads over the exact amount homeowners will save. Alan Dornfest, the Tax Policy Chief for the Idaho State Tax Commission, decided to put his number-crunching skills to the test. After diving into 2022 property tax data, he revealed that the pool of money allocated for homeowner tax relief amounts to a whopping 17.2% of the total property taxes collected from all Idaho homeowners last year.
Now, before you start doing your happy dance, remember that this number might change. Why? Because many of the state’s over 1,000 taxing districts could see their levy rates either spike or dip. However, the estimates so far align with the 10% to 20% reductions that were floated around by legislators and Governor Brad Little when House Bill 292 was initially introduced.
“We’re committed to this,” Dornfest emphatically stated in a recent interview. “The takeaway for Idahoans is that real savings are coming their way, and we’re working diligently to make that happen.”
So, what’s happening behind the scenes? As you read this, local officials from cities and counties are in the war room, meticulously working the calculators and preparing a range of reports. These will serve as the blueprint for determining the property tax cuts that homeowners can expect.
It’s a complicated process partly because county governments are still awaiting budget submissions from local taxing districts. Once these budgets roll in, counties will set the levy rates needed to fund them and forward this data to the state.
But what exactly should homeowners expect to see? Let’s break it down:
- Eligibility: To qualify, homeowners must have secured the homeowner’s exemption by the second Monday in July each year. If you own rental properties, second homes, or vacation homes—sorry, you’re out of luck. These are not eligible.
- No Additional Paperwork: If you’ve received the homeowner’s exemption, you’re all set! No need to drown in more paperwork to claim your tax cut.
- Tax Notice Credits: When the property tax notices land in your mail, look out for a credit that will reduce your tax liability. This credit will be clearly labeled as “tax relief appropriated by the Legislature,” as per the provisions in House Bill 292.
- Money Flow: Instead of sending checks to individual taxpayers, the state will funnel the money to counties. These counties will then distribute funds to local entities like cities, school districts, and fire departments. Note that certain taxes such as bonds, school district levies, and voter-approved temporary levies are excluded from this new tax relief program.
“The money isn’t going directly into taxpayers’ pockets, but it’s still a win,” Dornfest clarified. “We’re funneling the money to counties, who will then spread the savings to the taxing districts, effectively lowering your tax bill.”
In a nutshell, come November, Idaho homeowners can expect some very good news in their mailboxes!