Do Retirees Pay Property Taxes in Delaware?

Retirees in Delaware, like most property owners, are subject to property taxes. However, various programs exist at both the state and local levels that can provide significant relief for senior citizens. These programs often come with specific eligibility criteria related to age, residency, income, and property ownership, which can reduce a retiree’s overall tax burden.

Delaware Property Tax Basics

Property taxes in Delaware are primarily levied at the local level, funding county governments, municipalities, and school districts. There is no state-level property tax in Delaware. These taxes are calculated based on a property’s assessed value, which is determined by local assessors.

Historically, property assessments were based on outdated values. However, recent legislation now mandates that each county reassess properties at their present fair market value at least once every five years, aiming to ensure greater accuracy and equity in the tax system.

Local authorities, including county councils, school boards, and municipal governments, are responsible for setting their respective tax rates. Property tax bills are typically mailed in July or August and are generally due by September 30th. All real property owners in Delaware, including retirees, are generally subject to these taxes unless they qualify for specific exemptions or credits.

Senior Property Tax Relief Programs

Delaware offers several avenues for property tax relief specifically for senior citizens, with the most widely applicable being the State Senior School Property Tax Credit. This statewide program allows homeowners who are 65 years of age or older to receive a tax credit against their regular school property taxes. The credit amounts to 50 percent of the school property taxes, up to a maximum of $500. To qualify, the property must be the applicant’s primary residence.

To be eligible for the State Senior School Property Tax Credit, individuals establishing legal domicile in Delaware on or after January 1, 2018, must have been legally domiciled within the state for at least ten consecutive years. For those who established domicile between January 1, 2013, and December 31, 2017, a three-year residency period applies. Those who moved to Delaware before January 1, 2013, face no specific duration requirement. Additionally, all property taxes on the property must have been paid in full for the preceding tax year to qualify for the credit in the subsequent year.

Beyond the statewide credit, various local options for property tax relief exist, often referred to as Homestead Exemptions for Elderly Persons. These programs reduce the taxable value of property for county and municipal taxes, but their eligibility requirements and benefits differ significantly by county and municipality.

For instance, New Castle, Sussex, and Kent Counties each offer exemptions for seniors aged 65 or older, often with residency, income, and assessed value limitations. These exemptions provide a reduction in taxable assessed value. Some cities, such as Wilmington and Dover, also provide their own specific property tax reductions or exemptions for qualifying seniors, often with age and income stipulations.

Applying for Property Tax Relief

Seniors interested in applying for property tax relief programs must typically obtain application forms from their respective county assessment offices or the State of Delaware Department of Finance website. The application process requires specific documentation to verify eligibility. This usually includes proof of age, such as a valid Delaware driver’s license or state identification, and proof of residency.

Applicants may also need to provide income documentation, such as federal income tax forms, Social Security benefit statements, or pension statements, especially for programs with income limitations. Proof of property ownership, such as a property deed, is also a standard requirement. The property for which relief is sought must be the applicant’s primary residence.

Completed applications, along with all required supporting documents, should be submitted to the appropriate county assessment department. There are strict deadlines for application submission, with April 30th being a common deadline for the statewide Senior School Property Tax Credit. Local programs may have different deadlines. Property owners must ensure all property taxes from the preceding year are paid in full before applying for relief for the subsequent year. If an eligible senior moves, the exemption does not automatically transfer to the new property, and a new application is necessary.