Wednesday, September 12, 2012

Homestead exemption?

So there is an idea being put out there to raise the homestead exemption for local property taxes in the city of Pittsburgh and school district.

Now who suggested that might be a good idea broadly?   I guess the only difference is I did not think of the idea of raising the exemption amount as "in lieu of" mandated anti-windfall millage changes.  I guess the math works out the same.  My point then and now is that you have to raise the homestead exemption proporitonal to the reassessment value change or else the impact is regressive by default.  In other words.. the fixed amount exemption will be a lower proportion of total real estate value after the reassessment. Just to keep the tax incidence status quo you need to adjust the exemption amount.  

2 Comments:

Anonymous DBR96A said...

Wow, nobody pays property taxes in Homestead? I bet there'll be a lot of reinvestment there now.

Wednesday, September 12, 2012 5:24:00 PM  
Anonymous Anonymous said...

Chris,
The Homestead Exemption was instituted by the county many years ago - it's $15,000. The homestead exemption given by the City and School District is based upon a formula derived from the amount of gaming revenue provided to the taxing entities. Taxing entities must "return" the gaming revenue to the residents by way of a property tax decrease and they use "homestead exemption" to do that. It changes yearly based upon how much gambling revenue is received. WHY don't our politicians understand this???

Friday, September 14, 2012 8:05:00 AM  

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