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Iowa Homestead Exemption

Iowa Homestead Exemption - Property taxes are not determined by a single individual who assesses your property and sends you a bill. The final tax rate is the result of budgets established to provide services, an assessor’s assessment, a county auditor’s calculations, and laws administered by the Iowa Department of Revenue.

Because property assessment involves a series of events that takes 18 months from start to finish, this information will not be able to answer all your questions. It should, however, be able to explain the basic principles and events involved in calculating the property tax rate.

In Iowa, the homestead exemption is limited to one half acre in a city or town and forty acres in rural land. The exemption does not apply against taxes, debts existing prior to purchase and debts for purchase or improvement of the homestead. If a husband and wife own a homestead, the law usually requires that both of them sign a conveyance or mortgage regarding the real estate for it to be applicable or enforceable against both spouses. For Iowa, a designation or plat of a homestead may be filed with the county recorder.

Iowa Homestead Exemption - Occupancy

Any property owner in the State of Iowa who lives in the property can receive a homestead tax credit. To be eligible, a homeowner must occupy the homestead any six months out of the year, but must reside there on July 1. This exemption is a reduction of the taxable value of their property amounting to a maximum $4,850 or the amount which does not allow the taxable value to be less than zero.

Disabled veterans are allowed to claim a homestead credit that would be equal to the entire amount of taxes levied on the homestead property. The exemption is not allowed if the combined income of the veteran and their spouse, if any, exceeds $25,000 in the prior income tax year. Income means taxable income for federal income tax purposes plus income from any political subdivision exempt from federal income tax.

Filing Requirements: Claim must be filed on or before July 1. Claim is allowed for successive years without further filing as long as eligible.

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