The old saying goes, “A man’s home is his castle.” Your home may not have a moat and drawbridge, but you probably still want to protect it from creditors and predators. The Alabama Homestead Exemption allows most property owners to protect a certain portion of their property’s value. First, though, you need to understand what the Alabama Homestead Exemption is and how it works.
Not Every Property Qualifies
There are many types of real property, but not every property is eligible for the Alabama homestead exemption. To receive a homestead exemption, a property must be:
- Single-family,
- Owner-occupied,
- No more than 160 acres.
For example, a couple named Charles and Louise own the single family home they live in. They also own a 170-acre farm that is leased out to a tenant. Assuming they meet all other criteria, they should be eligible for a homestead exemption on their home, but not their ranch.
Different Types of Exemption
Homestead laws can be complicated, and Alabama is no exception. Exemptions can be taken at several levels:
- State. Exemptions range from
- $4,000 for people under age 65 to
- no maximum amount for people who are age 65+ or permanently & totally disabled or
- County. Exemptions are based on age and sometimes income. Persons over age 65 must have an adjusted gross income of less than $12,000. People with permanent or total disability or who are blind are not held to the income requirement.
- State, County & City. No maximum assessed value limitation for those age 65 or older or people of any age with permanent & total disabilities.
It’s also important to understand that federal law may supersede the Alabama Homestead Exemption. For example, a property owner may claim the state homestead exemption on his or her property. If that property owner fails to pay taxes, the IRS may be able to take the property regardless of the homestead exemption.
Are You Eligible for an Alabama Homestead Exemption?
But maybe you are not sure how to use the exemption? Contact a local attorney who knows and understands state law.
Attorney Bruce Adams is an Alabama attorney who knows how to listen to his client’s legal concerns and provide actionable advice. Please contact Bruce at 256-237-3339 to set up an appointment. Our office is located in Anniston, Alabama, but we assist clients in surrounding communities like Gadsden, Hoover, Talladega, Vestavia Hills.