The Colorado Senior Homestead Exemption: What Homeowners 65 and Older Should Know

Property values across Northern Colorado have risen considerably over the years, and with them, property tax bills. For retirees living on a fixed income, that increase can put real pressure on the budget. Colorado offers an exemption that can meaningfully reduce property taxes for many long-time senior homeowners.

The Senior Property Tax Exemption, often called the senior homestead exemption, is not automatic. Understanding the rules and applying on time can keep more money in your retirement plan every year.

Who may qualify

In general, the exemption is available to homeowners who are at least 65 years old as of January 1 of the year they apply, and who have owned and lived in the property as their primary residence for at least ten consecutive years. Surviving spouses of homeowners who previously qualified may also be eligible in certain situations.

For qualifying homeowners, a portion of the home's actual value, up to a limit set by state law, is exempt from property tax, and the state reimburses local governments for the difference. Colorado also offers a separate exemption for qualifying disabled veterans, which follows its own application process.

A single application can lower your property tax bill for every year you stay in your home.

How to apply and plan ahead

Applications are filed with your county assessor, such as the Larimer County Assessor for homes in Fort Collins, Loveland and Windsor. There is an annual filing deadline, and you will typically need information about your ownership history and residence. Once approved, the exemption generally continues as long as you remain eligible.

Colorado also offers a Property Tax, Rent and Heat Credit rebate for qualifying lower-income seniors and people with disabilities through the Colorado Department of Revenue. Because rules and amounts can change, check with the assessor and the state for the current requirements each year.

Finally, put the savings to work. Lower property taxes can help cover healthcare costs, home maintenance or an emergency fund, and may even reduce the amount you need to withdraw from retirement accounts, which can lower your income taxes as well.

The advisors at Tax Wealth Path help Fort Collins and Larimer County retirees plan for property taxes, income and long-term goals. Contact us for a free tax and wealth review.