As Iowans received their updated property tax assessments this year, many saw spikes in their values of upwards of 20%. For thousands of Iowa property owners who stared down these large assessments, including older Iowans and veterans, there was fear of a hike in their ultimate property tax bill and perhaps an inability to afford this higher payment on a fixed budget.
We know that many REALTORS heard from their clients about the assessment jumps and your clients also reached out to their legislators for policy solutions. Just like you, legislators listened to these stories and wanted to make a change to help ensure property ownership is affordable in our state.
Throughout the 2023 legislative session, the Iowa legislature was in property tax relief conversations with many proposals brought to the table. The IAR government affairs team was at the forefront of the property tax reform conversation and we were pleased to register in support of HF 718, a comprehensive property tax reform bill signed by Governor Reynolds which is estimated to lead to millions of dollars in tax relief for Iowa property owners. Below, we outline provisions of the bill that will provide significant tax relief to Iowans 65 years of age and older, as well as, veterans.
Property Tax Relief for Iowans 65+ Years of Age
HF718 creates a homestead tax exemption for Iowa property owners age 65 and older. This exemption of $3,250 is now available for those who were age 65 or older as of January 1, 2023 and beginning on January 1, 2024, the exemption will double to $6,500.
The application can be found at the link below or on the Iowa Department of Revenue website and is due to your local county assessor by July 1.
Homestead Tax Exemption Form
This new exemption is in addition to the current homestead tax credit of $4,850 and Iowa property owners 65+ years old do not need to reapply for the new exemption in the future unless something with their qualification status may have changed.
Property Tax Relief for Veterans
HF718 also provides property tax relief to veterans through an increase in the military service property tax exemption, increasing the exemption amount from $1,852 to $4,000. Veterans who already have applied for this exemption do not need to reapply to receive this increase.
New applicants for this exemption must complete the application found at the link below by July 1.
Military Service Tax Exemption Form
The Iowa Association of REALTORS is proud to have been instrumental in passing property tax relief this session and we look forward to working with our elected officials to continue to keep Iowa an affordable place to live.