Residential Tax Exemption Programs Make Homeownership More Affordable
Are you considering buying a home in Massachusetts but are concerned about the price? Homeownership may be more affordable than you think if you purchase a home in a community offering a residential tax exemption.
What is the MA residential tax exemption?
The Massachusetts residential tax exemption reduces the amount of taxes homeowners in certain communities pay annually based on a percentage of their home’s assessed value. That percentage is represented as a flat dollar amount that is exempt from taxation.
How much can you save?
Just as home prices vary, so does the average amount in tax savings, but it can be as much as 35%. The Massachusetts residential tax exemption percentage depends on the community and the assessed home value. According to the City of Somerville, for example, an eligible homeowner in the community with a property valued at $700,000 in fiscal year 2020 could have saved up to $3,269.27 off their taxes.
How much you wind up saving can change from year to year, depending on property values and the residential exemption percentage city councils, mayors or boards decide on.
How residential tax emption works
To be eligible for a residential tax exemption in Massachusetts, you must own and live in a property as your primary residence in a community offering the exemption. Each community decides which home characteristics will be included in the calculation of the tax exemption. Homeowners are not automatically granted the exemption; each community has its own application process.
Cities with a residential tax exemption
At least a dozen cities in Massachusetts offer the exemption, including:
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