Property Tax Stabilization for Seniors

Training for: Legal Notes

Recently enacted legislation added a new property tax relief option for Maine residents 65 years or older.

PL 2021, c. 751 (to be codified at 36 M.R.S. § 6281), requires municipalities to “stabilize” – meaning freeze – the property tax responsibility of eligible taxpayers at the amount billed the preceding tax year. If taxes assessed on eligible property exceed the “stabilized” amount, the law currently requires the state to reimburse municipalities 100% of the difference.

An eligible taxpayer must: (1) be 65 years or older, (2) be a permanent Maine resident as defined in the Maine Resident Homestead Property Tax program (“Homestead Program”), and (3) have owned a qualifying homestead in Maine for a total of at least 10 years prior to application. Stabilization applies only to property occupied by an eligible taxpayer which is eligible for a Homestead Program exemption. The law includes no limits on an applicant’s income or the market value of the homestead property.

Taxpayers must annually apply for the program by the December 1st preceding the property tax year for which stabilization is requested (the tax year begins on April 1st of each year). Eligible taxpayers may also transfer stabilization benefits to new homesteads established within Maine.

Note that the law does not freeze an eligible homestead’s property tax valuation or the taxpayer’s tax assessment; municipal assessors must continue to record the property’s just value in each annual property tax commitment. The law merely freezes the amount an eligible taxpayer may be billed by the municipality.

Taxpayers may apply for the program until December 1. However, “stabilization” will first apply only to property taxes committed during calendar year 2023 (based on an assessment date of April 1, 2023). Tax bills issued based on property taxes committed during calendar 2022 will not be affected.

The Maine Revenue Services Property Tax Division has issued an application form and program guidance on its website at: https://www.maine.gov/revenue/taxes/tax-relief-credits-programs/property-tax-relief-programs/stabilization-program. (S.F.P.)

Recently enacted legislation added a new property tax relief option for Maine residents 65 years or older.

PL 2021, c. 751 (to be codified at 36 M.R.S. § 6281), requires municipalities to “stabilize” – meaning freeze – the property tax responsibility of eligible taxpayers at the amount billed the preceding tax year. If taxes assessed on eligible property exceed the “stabilized” amount, the law currently requires the state to reimburse municipalities 100% of the difference.

An eligible taxpayer must: (1) be 65 years or older, (2) be a permanent Maine resident as defined in the Maine Resident Homestead Property Tax program (“Homestead Program”), and (3) have owned a qualifying homestead in Maine for a total of at least 10 years prior to application. Stabilization applies only to property occupied by an eligible taxpayer which is eligible for a Homestead Program exemption. The law includes no limits on an applicant’s income or the market value of the homestead property.

Taxpayers must annually apply for the program by the December 1st preceding the property tax year for which stabilization is requested (the tax year begins on April 1st of each year). Eligible taxpayers may also transfer stabilization benefits to new homesteads established within Maine.

Note that the law does not freeze an eligible homestead’s property tax valuation or the taxpayer’s tax assessment; municipal assessors must continue to record the property’s just value in each annual property tax commitment. The law merely freezes the amount an eligible taxpayer may be billed by the municipality.

Taxpayers may apply for the program until December 1. However, “stabilization” will first apply only to property taxes committed during calendar year 2023 (based on an assessment date of April 1, 2023). Tax bills issued based on property taxes committed during calendar 2022 will not be affected.

The Maine Revenue Services Property Tax Division has issued an application form and program guidance on its website at: https://www.maine.gov/revenue/taxes/tax-relief-credits-programs/property-tax-relief-programs/stabilization-program. (S.F.P.)