What are Real Estate Exemptions?

A tax exemption is a discharge from the obligation to pay all or a portion of a tax. Exemptions are conferred by the Legislature on particular categories of persons or property.

A person may be eligible to reduce all or a portion of the real estate taxes assessed to the person's domicile if he or she meets the qualifications for one of the personal property exemptions allowed under Massachusetts' law. Qualifications vary, but generally relate to age, ownership, residency, disability, income or assets.

A person may be eligible for a personal exemption if he or she falls into any of the following categories:

Blind persons
Veteran with a service connected disability
Surviving Spouse
Minor Child of Deceased Parent
Senior Citizen age 70 and older

Who may file an exemption application?

A person who meets all the qualifications for a particular exemption as of JULY 1 must apply on the properly approved forms for an exemption. Also, an administrator or executor of a person who qualified for a personal exemption as of July 1 may file the application.

When and where must the application be filed?

The application must be filed with the local Board of Assessors any time after July 1 but no later than three months after the actual tax bills were mailed for the fiscal year. If certification of the annual tax rate is timely, the third tax bill is the actual bill. The filing deadline cannot be extended or waived by the Assessors for any reason. The application is filed when received by the Assessors. If an application is not timely filed, a person loses all rights to the exemption and the Assessors by law cannot grant the personal exemption.

Must the taxes be paid while the application is processed?

Filing an application for an exemption does not stay the collection of a property tax. In some cases, a person must pay the tax when due in order to appeal the assessors' denial of an exemption. Failure to pay a tax when due may subject the person to interest charges and collection action. To avoid any additional charges or any loss of rights, a person should pay the tax assessed. If an exemption is granted and the person had already paid the entire year's tax, the person will receive a refund of any overpayment.

When must the Assessors act on exemption applications?

The Assessors have three months from the date the application is filed to act on it. An applicant will be notified in writing whether an exemption has been granted or denied. A person may appeal a denial by the Assessors. The disposition notice will provide further information about appeal procedures and deadlines.

What personal exemptions may be available to citizens of Everett?

The categories of exemptions described below are grouped according to Clauses in the General Laws.

Clause 37 Blind Persons
Clauses 22 through 22 E Veterans
Clause 41 D Elderly Persons
Clause 17 D Surviving Spouse, Minor Child, or Elderly Person

VETERANS EXEMPTIONS (CLAUSES 22 THROUGH CLAUSE 22 E AND PARAPLEGICS)

Veterans, male or female, who served in the armed forces of the United States for not less than 90 days active service, at least one day of which was for wartime service*, and whose last discharge or release from wartime service was under honorable conditions, may be eligible for an exemption. (Check with the Assessors for more particulars on "wartime service" and dates for qualifying military action specified in the state statutes.

RESIDENCY, DOMICILE & OCCUPANCY REQUIREMENTS FOR VETERANS

An individual must have been a Massachusetts domiciliary prior to entering the service or have lived in Massachusetts for not less than 5 years prior to applying for the exemption. The veteran must occupy the property as his or her domicile on July I of the tax year.

DOCUMENTATION FOR VETERANS

An applicant for an exemption must provide to whatever information is reasonably requires to establish eligibility. This information may include, but is not limited, to: (1) Certification of war-service connected disability from the Veterans Administration or branch of the service from which separated. (2) Evidence of domicile and occupancy.

OWNERSHIP REQUIREMENTS FOR VETERANS

A qualifying applicant must possess a sufficient ownership interest in the domicile. To satisfy this ownership requirement, the person's interest must be worth at least $2000. Ownership may be held jointly or in common.

A holder of a life estate satisfies the ownership requirement,

If the domicile is held in trust, a person can only satisfy the ownership interest if he or she is a trustee or co-trustee of that trust and possess a sufficient beneficial interest in the domicile through the trust.

ELIGIBILITY REQUIREMENTS AND EXEMPTION AMOUNTS FOR EACH VETERAN CLAUSE

CLAUSE 22 ($250.00)

This exemption is available to the following classes of persons: (1) Veterans with a war-service connected disability of 10% or more as determined by the Veterans Administration or branch of the service from which separated. (2) Veterans who have been awarded the Purple Heart. (3) Gold Star mothers or fathers. (4) Spouses and surviving spouses of entitled to the exemption.

CLAUSE 22 A ($425.00)

This exemption is available to veterans (and their spouses) who: (1) Suffered in the line of duty the loss or permanent loss of use of one foot or hand or one eye. (2) Received the Congressional Medal of Honor, Distinguished Flying Cross, Navy Cross or Air Force Cross. If the subject property is greater than a single family house, only that fraction of $350.00 which corresponds to the segment occupied by the veteran will be allowed.

CLAUSE 22 B ($775.00)

This exemption is available to veterans (and their spouses) who suffered in the line of duty the loss or permanent loss of use of both feet or both hands or both eyes. If the subject property is greater than a single family house, only that fraction of $700.00 which corresponds to the segment occupied by the veteran will be allowed.

CLAUSE 22 C ($875.00)

This exemption is available to veterans (and their spouses) who (1) suffered total disability in the line of duty and (2) who received assistance in acquiring "specially adapted housing" which they own and occupy as their domicile. If the subject property is greater than a single family house, only that fraction of $875.00 which corresponds to the segment occupied by the v will be allowed.

CLAUSE 22 D ($350.00)

This exemption is available to surviving spouses (who did not remarry) of soldiers and sailors who died in combat at the islands of Quemoy and Matsu.

CLAUSE 22 E ($600.00)

This exemption is available to vet who suffered total disability in the line of duty and are incapable of working. If the subject property is greater than a single family house, only that fraction of $525.00 which corresponds to the segment occupied by the veteran will be allowed.

PARAPLEGIC (TOTAL EXEMPTION)

This exemption is available to vet and surviving spouses (who do not remarry) of such veterans who are certified by the Veterans Administration as paraplegic.

SURVIVING SPOUSE, MINOR CHILD AND ELDERLY PERSON

EXEMPTION (CLAUSE 17 D) AMOUNT $189.73

As previously noted, acceptance by the Everett City Council of this clause will permit the application of this exemption to the Fiscal 1997 real estate tax bill.

This exemption applies to (1) widows and widowers (2) minor children with one parent deceased and (3) persons 70 years of age or older as of July I of the tax year.

DOCUMENTATION REQUIREMENTS FOR CLAUSE 17 D

Applicants for the Clause 17 D exemption must provide the assessors whatever information is reasonably required to establish eligibility. This information may include, but not be limited to: (I) Birth certificates. (2) Evidence of domicile and occupancy. (3) Income tax returns.

OWNERSHIP, DOMICILE, & OCCUPANCY REQUIREMENTS CLAUSE 17 D

To qualify for Clause 17 D, an individual must own and occupy the subject property as his or her domicile for at least 5 years. A person's interest in the domicile must be worth at least $2000. A may own this interest solely, as a joint owner or as a tenant in common.

The holder of a life estate satisfies the ownership requirement.

If the domicile is held in trust, a person can only satisfy the ownership interest if he or she is a trustee or co--trustee of that trust and possess a sufficient beneficial interest in the domicile through that trust.

INCOME AND WHOLE ESTATE REQUIREMENTS FOR CLAUSE 17 D

There are NO limitations on annual income for eligibility under Clause 17 D.

The whole estate value (excluding the total value of the subject property, not to exceed 3 dwelling units, and any unpaid mortgage balance on the property) cannot exceed $40,000. For a property containing 4 or more dwelling units, the value of that portion exceeding 3 units must be included. Included in the whole estate is the value of other real estate and personal property which includes bank accounts, stocks, bonds, securities, motor vehicles and trailers, and other non-exempt personal property. The value of a person's cemetery plots, wearing apparel and household furniture and effects at the domicile should be excluded from the calculation of the person's whole estate for purposes of this clause.

BLIND PERSONS EXEMPTION (CLAUSE 37) $437.50

RESIDENCY REQUIREMENTS FOR BLIND PERSONS

The blind must own the property separately or jointly or as a tenant in common and occupy the property as his or her domicile on July I of the tax year. There is no apportionment of this exemption if the ownership is held jointly or as a tenant in common with some other person other than a spouse. The blind person receives the full amount.

ELIGIBILITY REQUIREMENTS FOR BLINDNESS EXEMPTION

An individual must annually give proof of blindness by providing a certificate from the Commission of the Blind attesting to a condition of legal blindness. As an alternative for the first year an exemption is sought, a letter from a reputable physician certifying blindness in accordance with the specifications of the Commission for the Blind must be provided.

ELDERLY PERSONS EXEMPTION (CLAUSE 41 C) $500.00

RESIDENCY REQUIREMENTS FOR ELDERLY EXEMPTION

An individual must own and occupy the subject on July I of the tax year. Also, an individual must have been continuously domiciled in Massachusetts for the 10 years preceding the application and have owned and occupied the property or other property in Massachusetts for 5 years.

Ownership may be a joint tenant or as tenant in common with someone other than a spouse. In which case the exemption is the same proportion of $500.00 as one's ownership interest in the property.

DOCUMENTATION FOR ELDERLY EXEMPTION

An applicant must supply the Assessors whatever information is reasonably necessary to establish eligibility. This information may include, but not be limited to: (1) Birth certificates. (2) Evidence of domicile and occupancy. (3) Income tax returns.

AGE REQUIREMENTS FOR ELDERLY EXEMPTION

An applicant must have reached his/her 70th birthday prior to July I of the tax year or if property owned jointly with spouse, either spouse has reached his/her 70th birthday.

ANNUAL INCOME AND WHOLE ESTATE REQUIREMENTS FOR ELDERLY EXEMPTION

Gross receipts (minus a social security allowance) from all sources in the preceding calendar year must be less than $13,000 if single and be less than $15,000 if married. Gross receipts include, but are not limited to, wages, pension allowances, retirement benefits, interest and dividends, rents, capital gains, and net profits from business or profession.

The whole estate value (less the value of the home except for the value of any portion which exceeds three dwelling units and produces income) cannot exceed $28,000 if single and $30,000 if married. Included in the whole estate is the value of other real estate and personal estate which includes accounts, stocks, bonds, securities, motor vehicles and trailers, and other non-exempt personal property.

HARDSHIP EXEMPTION (CLAUSE 18)

WHO MAY FILE A CLAUSE 18 HARDSHIP EXEMPTION APPLICATION?

Any person or persons "who by reason of age, infirmity and poverty are in the judgment of the Assessors unable to contribute toward public charges" may upon proper application and approval of the Assessors receive a reduction of a portion or all of the real estate taxes assessed. At the time of the Gulf War a person called into active military service and experienced financial hardship was added to the list of people who may apply for this exemption. Generally, an applicant must be at least 65 years of age or older, but in some circumstance a younger person or persons might be eligible. If the applicant owns the subject property jointly with others, all joint owners must independently qualify in order for the applicant to be eligible for the exemption.

DOCUMENTATION FOR HARDSHIP EXEMPTION

An applicant must supply the Assessors with documented evidence relating to the nature and history of an infirmity and complete documentation disclosing the financial circumstances of the applicant, including income from all sources.

PROPERTY TAX DEFERRAL (CLAUSE 41 A)

This clause is not actually an exemption but rather it is a postponement of the payment of real estate taxes. if an applicant qualifies, the applicant must enter a tax deferral agreement that requires the deferred taxes along with interest be paid in full (1) when the property is sold, (2) upon the death of the person, or (3) upon the death of the surviving spouse if he or she qualifies for a deferral and enters into a new tax deferral agreement Anyone having any legal or beneficial interest in the property must also approve the tax deferral agreement

AGE REQUIREMENTS FOR TAX DEFERRAL

An applicant must be at least 65 years of age as of July 1 of the tax year.

DOMICILE, OWNERSHIP AND OCCUPANCY REQUIREMENTS FOR TAX DEFERRAL

The applicant must have had a domicile or legal home in Massachusetts for the preceding ten years and must be domiciled as of July 1 in the property which is the subject of the application.

The applicant must have owned and occupied the subject property or other real property the Commonwealth as a domicile for at least five years.

The applicant may own the property jointly with his or her spouse or as tenants in common with a person not his or her spouse.

The holder of a life estate satisfies the ownership provisions under this clause.

If the domicile is held in trust, a person can only satisfy the ownership interest if he or she is a trustee or co-trustee of that trust and possesses a sufficient beneficial interest in the domicile through the trust.

SURVIVING SPOUSE AND CONTINUATION OF TAX DEFERRAL

A surviving spouse who qualities may continue to defer taxes but must enter into a new tax deferral and recovery agreement. A surviving spouse who inherits the property must have occupied it or other real property in Massachusetts as a domicile for 5 years.

INCOME AND GROSS RECEIPT REQUIREMENTS FOR TAX DEFERRAL

There are no whole worth restrictions, but there are income limitations for the tax deferral.

GROSS RECEIPTS: An applicant's gross receipts from all sources cannot exceed $20,000. If married, combined gross receipts cannot exceed $20,000. Ordinary business expenses and losses, but not personal or family expenses may be deducted. By local option of the Everett City Council the amount of qualifying gross receipts can be in to an amount up to $40,000.

DEFERRAL AMOUNT

A taxpayer who qualifies may defer payment of all or a portion of the taxes at 8 per cent interest, provided the deferred taxes and accrued interest do not exceed 50 per cent of the applicant's proportional share of the fair value of the property.

APPLICATION FORMS AND ADDITIONAL INFORMATION

Application forms for the various exemptions are available at the Everett Office. For additional information or clarification regarding the exemptions, please contact the office at 617-394-2205