Homestead Circuit Breaker Tax Deferral for Senior or Disabled Citizens

State

North Carolina

Year

2022

Variations in Receipt of Benefit

Benefit Varies with Income

Benefit Type

Circuit Breaker

Deferral

Benefit

Under the program, taxes are limited to a percentage of income. The amount of the taxes deferred is a lien on the property. For tax year 2022, applicants with income below the eligible level ($31,900) may defer taxes in excess of 4%. Those with income above the eligible level and below 150% ($47,850) of eligible income may defer taxes in excess of 5%. The deferred amount from the previous three years will become due and payable if the property is no longer the permanent residence of either the owner, co-owners, or spouse.

How is Benefit Disbursed

Other

Eligible Property Type

Residential

Characteristics of Eligible Property

Only residential property and up to one acre of land on which the residence is located are eligible for the relief. Residential property can include a single-family residence, a unit in a multi-dwelling complex, or a manufactured home.

Eligibility Criteria

Age

Disability

Homeowner

Income Ceiling

Principal Residence

Other Criteria

Description of Eligibility Criteria

Qualifying homeowners must be North Carolina residents, at least 65 years of age or have a total and permanent disability, and own and occupy the homestead as a principal place of residence for at least 5 consecutive years. If the property has multiple owners who are not married, all owners must qualify and elect to defer the taxes. For 2022, the income eligibility limit is $31,900. Applicants must have income less than 150% ($47,850) of the income eligibility limit. The limit is adjusted annually by the percentage of any cost-of-living adjustment to Social Security. If an applicant ceases to be eligible for the program, the deferred amount from the previous three years will become due and payable.

Local Option in Adoption of Program

Local government is unable to exercise an option

Local Option Regarding Program Features

No local option regarding program features

State Funding for Local Tax Loss

Local government covers all of its tax loss

Description of State Funding for Tax Loss

The statue is silent regarding whether or not the state reimburses the local governments for any tax loss.

Record ID

NC103_RR22

Footnotes

An owner who receives this benefit may not receive other property tax relief. An otherwise qualifying owner does not lose the benefit because of a temporary absence from their residence for medical reasons or if the qualified owner is confined to a rest or nursing home. During this period, the residence must be unoccupied or occupied by the owner's spouse or other dependent. If the owner is not eligible for a continued deferral for a tax year, the deferred taxes are carried forward. If the owner transfers the property, dies, or ceases to use the property as a permanent residence, the last three years of deferred taxes prior to the disqualifying event become due and payable with interest on the date of the disqualifying event. To receive the benefit, an application must be submitted by June 1 of the year preceding the year that the benefit is claimed. The application must be filed every year.

Sources

N.C. Gen. Stat. § 105‑277.1B (in effect for 2022)
North Carolina Department of Revenue, Application for Property Tax Relief (2022)
[https://www.ncdor.gov/media/13466/open Accessed 02/23/2023]
View Archived Source
Buncombe County Tax Department, Circuit Breaker Program
[https://www.buncombecounty.org/governing/depts/tax/circuit-breaker.aspx Accessed 03/07/2023]
View Archived Source

Iredell County Assessor's Office, Property Tax Homestead Circuit Breaker Program
[https://www.iredellcountync.gov/407/Property-Tax-Homestead-Circuit-Breaker-P Accessed 03/07/2023]
View Archived Source

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