The Cap Rate for Property Taxes Will Reset When Someone New Is Added / Removed From The Title - How To Avoid This
Some states have what is known as a 'property tax cap rate' which guarantees the property taxes for a primary residence will not increase beyond a given amount by law. When a property is transferred via a quitclaim deed or a person is added / removed from the title, the 'capped value of the residence' is reset and the county may legally assess the property with a higher value, thus a higher property tax. Unfortunately, there is no way to avoid this issue while using an irrevocable trust outside removing one's property from the tax rolls and thus avoiding all property taxes legally (see Real Estate Secrets). Alternatively, the use of a revocable living trust can avoid any uncapping events and still maintain the ability for the home's transfer to avoid probate court.
NOTE: Be aware that the city, village, or township may offer a tax deferment for people over the age of 62. Provided that person's household income is not more than a specific amount, given the state.
Related Articles
Quitclaim Deed Property with Back Taxes into Trust
Quitclaim deeds can avoid a clouded title (liens, back taxes, etc.) via an as-is deed conveyance, but the property cannot be sold to anyone requiring financing unless the outstanding liens are paid.
Quit Claim Deed into Trust and Tax Implications
What Is a Quit Claim Deed A quit claim deed is a type of deed that transfers ownership of real property from one person to another without any types of warranties. This means that if you receive property via a quit claim deed, you're taking it as it ...
Can One Transfer A Clouded Title / Property Into Trust
Yes, the transfer can still occur via a Quitclaim Deed (sells home as-is). An unpaid mortgage clouds title, but can still be transferred into a trust; however, the loan must be repaid in full to sell the property to any entity who requires financing ...
How Does One Obtain Non-Obligation For Property Taxes
Real Estate Secrets covers the method for obtaining Allodial Title (Land Patent) which is necessary to begin. Afterwards, removal from tax rolls and voter rolls is necessary. Once this has occurred, one should have the local Sheriff's signature ...
Income Taxes and Lawful Money
Under its power to borrow money, Congress is authorized by the Constitution to contract debt, and whenever something is borrowed it must be returned. When Congress spends the contracted private credit, each use of credit is debt which must be ...