Homestead exemption

The homestead exemption is a legal regime designed to protect the value of the homes of residents from property taxes, creditors, and circumstances arising from the death of the homeowner spouse. Laws are found in state statutes or constitutional provisions which exist in many states in the United States. The homestead exemption in certain southern states has its legal origins in colonial Spanish exemption laws. Exemption laws in other states were enacted in response to the effects of economic health in the 19th century.

Homestead exemption laws typically have four primary features:

For purposes of these statutes, a homestead is the one primary residence of a person, and no other exemption can be claimed on any other property anywhere, even outside the boundaries of the jurisdiction where the exemption is claimed.

In some states, homestead protection is automatic. In many states, however, homeowner will not receive the protections of the law until they file a claim for homestead exemption with the state. Furthermore, the protection can be lost if the homeowner abandons the protected property by taking up primary residence elsewhere.

Different jurisdictions provide different degrees of protection under homestead exemption laws. Some only protect property up to a certain value, while others have acreage limitations. If a homestead exceeds these limits creditors may still force the sale while the homesteader may keep a certain amount of the proceeds of the sale.

California protects up to $75,000 for single people, $100,000 for married couples, and $175,000 for people over 65 or legally disabled. In California, SB 308 was introduced in early 2015. It initially proposed a $700,000 homestead exemption regardless of age or marital status. It has recently been amended down to $300,000.

Texas, Florida, Iowa, South Dakota, Kansas, and Oklahoma have some of the broadest homestead protections in the US, in terms of the value of property that can be protected.

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