Many states have a Senior Freeze Program that reimburses eligible senior citizens and disabled persons for property tax or mobile home park site fee increases on their principal residence.
nj.com’s recent article addressed this question: “I inherited this home. Can I get the Senior Freeze?” The answer? The Senior Freeze apparently has several eligibility requirements, including age or disability, residency, homeownership and income limits. You must also be paying the property taxes on the property during the ownership period.
To be eligible, an individual or his spouse/civil union partner generally must be age 65 or older; or actually receiving federal Social Security disability benefit payments (instead of benefit payments received on behalf of someone else). Among other requirements, you’re typically not eligible for a reimbursement on:
- A vacation home or second home;
- Property that you rent to another;
- Property that is over four units; or
- Property with four units or fewer that has than one commercial unit.
The issue of how you determine the date of ownership, may depend on how an individual inherited the home at the parent’s death. If the home was specifically bequeathed to the child in the parent’s will, and assuming he or she was paying the real estate taxes and other carrying charges of the home upon his death, the argument could be made that as of the date of death, the child became the owner of the home and the execution of the deed by the executor of the estate only evidenced this ownership.
However, if the parent died intestate–without a will—or if his will didn’t specifically bequeath the real estate, and if he or she wasn’t paying the real estate taxes and other expenses for the property since the date of death, then it’s pretty cut and dried that the estate held ownership, until title was transferred to the child by deed.
For capital gains purposes, when a home is included in a decedent’s estate, it’s the date of death value of the home that’s considered a beneficiary’s initial basis, rather than the assessed value. While the date of death value may be the same as the assessed value, the two values are not necessarily the same, especially in towns where the true to assessed value ratio is not 100%.
Reference: nj.com (September 2, 2019) “I inherited this home. Can I get the Senior Freeze?”
Suggested Key Terms: Senior Freeze, Estate Planning, Capital Gains, Asset Protection, Inheritance, Tax Planning, Financial Planning, Probate Attorney, Intestacy, Estate Tax