By MillRate USA · Last reviewed 2026-10-27
Four ways states lower a homeowner's bill
- An exemption or deduction takes a set amount or share off the value the rate applies to. Texas and Indiana work this way.
- An assessment cap limits how much the taxable value of a home can rise each year. Maryland, Michigan and Texas have one.
- A lower rate for an owner-occupied home. Michigan's homestead rate skips up to 18 mills of school operating tax.
- A credit or rebate comes off the bill or is paid back afterwards. New Jersey and Rhode Island use these.
On top of these, most states have programs for seniors, people with disabilities and veterans, with their own rules.
At a glance
| State | Main homestead benefit | Apply to |
|---|---|---|
| Connecticut | State relief programs for elderly, disabled and veteran owners; towns add their own | Your town assessor |
| Indiana | Homestead standard deduction ($48,000 for 2026) plus a supplemental deduction (40% for 2026); 1% bill cap | Your county auditor |
| Iowa | Homestead credit, on $4,850 of value; becoming a 10% exemption ($5,500 to $20,000) from 2027 bills | Your county assessor |
| Maryland | Homestead credit caps yearly assessment increases: 10% for state tax, local caps up to 10% | SDAT (one-time application) |
| Massachusetts | Personal exemptions; a residential exemption in some cities | Your board of assessors |
| Michigan | Principal residence exemption: up to 18 mills of school operating tax | Your local assessor |
| New Jersey | ANCHOR, Senior Freeze and Stay NJ; local $250 deductions | Division of Taxation; your town |
| North Carolina | Three relief programs for elderly, disabled and veteran owners | Your county assessor, Form AV-9, by June 1 |
| Rhode Island | State relief credit; homestead and other exemptions set by each town | Division of Taxation (RI-1040H); your assessor |
| Texas | $140,000 school district exemption; 10% yearly appraisal cap | Your appraisal district |
| Virginia | Local programs for seniors and disabled owners; state exemption for 100% disabled veterans | Your commissioner of the revenue or assessor |
State by state
Texas: $140,000 off for school taxes, and a 10% cap
The Comptroller says state law "requires school districts to provide a $140,000 exemption on a residence homestead," and "an additional $60,000 residence homestead exemption" for owners 65 or older or disabled. Cities, counties and other units may offer their own optional exemptions, so your taxable value usually differs by unit. A homestead's appraised value can also rise "a maximum of 10% each year until it reaches the full market value," as Harris Central Appraisal District puts it. Apply to your appraisal district. Texas guide
Indiana: deductions, then a 1% cap
An owner-occupied main home can claim the homestead standard deduction, which also qualifies it for Indiana's 1% bill cap, plus a supplemental homestead deduction. The Department of Local Government Finance lists the standard deduction at $48,000 for taxes payable in 2026, falling to $40,000 for 2027, and the supplemental deduction at 40% of the remaining value for 2026 and 46% for 2027, as a 2025 law phases them down and adds new homestead credits. Indiana guide
Michigan: a lower rate for the home you live in
Michigan's principal residence exemption "exempts an owner's principal residence from the local school operating millage, up to 18 mills," Treasury says. That's why every Michigan place has a homestead rate and a higher non-homestead rate. Taxable value is also capped: it can rise by no more than 5% or inflation each year until the home sells. Claim the exemption with your local assessor. Michigan guide
Maryland: a cap on assessment increases
For state tax, Maryland's homestead credit means "any annual assessment increase for a home or homesite that is greater than 10% is not taxed." Counties and towns set their own caps for local tax, from 0% to 10%. SDAT says owners must "submit a one-time application," for their principal residence only. Maryland guide
Iowa: a credit becoming an exemption
Iowa's homestead credit has been "equal to the property taxes paid on $4,850 of a homestead's value," the Department of Revenue says. From the 2026 assessment year, for taxes paid in September 2027 and March 2028, it becomes an exemption of 10% of taxable value, at least $5,500 and at most $20,000. Separate exemptions cover owners 65 and older and military service. Iowa guide
New Jersey: rebates and a senior freeze
New Jersey's main programs are run by the Division of Taxation: ANCHOR for eligible homeowners and renters; Senior Freeze, which "reimburses eligible senior citizens and disabled persons" for increases on their main home; and Stay NJ, which "offers property tax benefits to eligible homeowners aged 65 and older." Towns also administer a deduction of up to $250 for eligible owners 65 or older or disabled, and up to $250 for qualified war veterans. New Jersey guide
North Carolina: three relief programs, one form
North Carolina's Elderly or Disabled Exclusion, Disabled Veteran Exclusion and Circuit Breaker Tax Deferment are all applied for at your county tax assessor on Form AV-9, which states it "must be filed by June 1st to be timely filed." North Carolina guide
Connecticut, Massachusetts, Rhode Island and Virginia: mostly local
In these states, much of the relief is set or administered locally.
- Connecticut runs state programs for elderly and disabled owners (circuit breaker and freeze), veterans and the totally disabled, applied for through your town, and towns can add their own. Connecticut guide
- Massachusetts assessors handle personal exemptions and, in cities that offer it, the residential exemption for owner-occupied homes. Massachusetts guide
- Rhode Island offers a state relief credit on Form RI-1040H; homestead, elderly and veterans' exemptions are set by each city or town. Rhode Island guide
- Virginia localities may offer exemptions or deferrals for seniors and people with disabilities, and the state exempts the main home of a veteran with "a 100 percent service-connected, permanent, and total disability." Virginia guide
Three things to check this year
- Is it on your bill or notice? If your home is your main residence and no homestead benefit appears, ask your assessor.
- Is there a deadline? North Carolina's is June 1. Others vary; your assessor has them.
- Did you move or buy? Most benefits don't follow you. Apply again for the new home.
Then see how your rate compares on your place's page, via the states list, and check how to appeal your value.
Sources
- Texas Comptroller, property tax exemptions
- Harris Central Appraisal District, the 10% homestead cap
- Indiana DLGF, legislation affecting deductions, credits and exemptions (May 2026)
- Michigan Treasury, Principal Residence Exemption
- Maryland SDAT, Homestead Tax Credit
- Iowa Department of Revenue, Homestead Tax Credit and Exemption
- New Jersey Division of Taxation, property tax relief programs
- North Carolina Department of Revenue, Form AV-9
- Connecticut OPM, tax relief programs
- Massachusetts DLS, the role of the assessor
- Rhode Island Division of Taxation
- Code of Virginia § 58.1-3219.5, disabled veterans' exemption
This guide explains how the system works. It isn't legal or tax advice, and programs and amounts change. Your assessor and your state's tax agency have the final word. Spotted an error? Email [email protected].