As a homeowner in Charlotte, NC, you are responsible for paying property taxes to Mecklenburg County or a nearby county, including Union County, York County, Gaston County, Lincoln County, or Cabarrus County.
While North Carolina has lower property tax rates than other states, keeping up with property tax payments can be a challenge, especially if your financial situation changes unexpectedly. You might find yourself dealing with tax penalties, back taxes, and liens.
There are a few things you need to know about property tax in Charlotte, NC, as well as exemptions you might qualify for.
Property Taxes in Charlotte, North Carolina
North Carolina uses an ad valorem system, which means that you pay taxes based on the value of your home. Note that NC uses a different method for taxes on motor vehicles.
What Is the Average Tax Rate in NC?
On average, homeowners pay a property tax rate of 0.77% in North Carolina, which is below the national average.
Who Collects Property Taxes?
The county you live in is responsible for collecting property taxes. The county tax you pay will go toward running the local government and will fund things such as the public school system in your area and the fire district.
The NC Department of Revenue provides different services to help counties and taxpayers. This agency has many online resources with helpful answers if you’re running into issues with paying your property taxes. The agency also issues the official tax forms for paying your property tax.
How Do You Pay Your Property Tax?
If you’re still making mortgage payments on your home, chances are that your bank is collecting a monthly fee that goes toward paying your property tax in Charlotte, NC. If you have paid off your home, you’re responsible for putting money aside and paying taxes to your county. You can pay your taxes with a credit card or bank transfer to the local tax office.
How Does Your County Determine the Value of Your Property?
Mecklenburg County and other nearby counties use appraisals to determine the value of a home. Counties typically conduct new assessments every eight years to reflect changes in the local housing market.
However, there are situations where your county will conduct a revaluation of your property sooner. You can ask for a new appraisal if there was a mistake with the previous property value or if you invested in a home improvement project. A revaluation can also happen if the economic situation of the county changes.
You should reach out to the assessor’s office if you have any questions about this process or want to report a mistake.
How Often Should You Pay Property Taxes?
You should pay property taxes once a year. You’re liable for real estate taxes on any property you own as of January 1st of the tax year.
You have until September 1st to pay your property taxes. If you miss this deadline, your county will consider that your taxes are past due on January 5th.
What Happens If You Don’t Pay Your Property Taxes?
If you fail to meet your tax obligations, penalty and interests will start accruing daily on your annual property tax. The penalty rate is 2% in January and 0.75% for the rest of the year.
Your county offers installment plans to help you catch up on back taxes. Don’t ignore any personal property taxes notifications you get in the mail. It’s in your best interest to reach out and apply for an installment plan since your county will likely take action quickly if you fall behind on your property taxes.
If you get behind on your property taxes, a judge will issue a judgment against you, and your county will start garnishing your wages and seizing other assets to cover what you owe. You can expect legal action to begin within six months of the January 5th deadline, but your county might take action immediately.
Can You Sell Your Home If You’re Behind on Property Taxes?
If you get behind on your taxes, your county will place a lien on your home. You will have to sell your house as-is and get this lien cleared as part of the selling process.
You can get the lien removed by paying what you owe or by negotiating with the local government to settle for less than you owe. It’s usually best to sell your house for cash in this situation since cash home buyers in Salisbury and other nearby areas have enough money to cover back taxes. Not all real estate agents will want to help you sell a home with a lien.
If you’re in this situation and keep thinking, “I wish someone would buy my house in North Carolina quickly,” you’re in luck. We buy houses in Charlotte and make fair cash offers on properties sold as-is.
Can You Deduct Your Property Taxes from Your Tax Return?
You can deduct what you paid in property taxes if you itemize your deductions. However, the standard deduction already covers ordinary expenses like property taxes.
Charlotte Property Tax Exemptions
A homestead exemption can reduce your tax bill by waiving your tax liability for up to $35,000 of the value of your home.
There are two situations in which you can qualify for a homestead exemption on your property tax in Charlotte, NC:
- You owned a home jointly with a spouse who is now deceased. In this situation, you can apply for a homestead exemption to shield your home from creditors and reduce your tax bill so you can afford to keep your property. If you’re 65 or older with a deceased spouse, you can qualify for an exemption of up to $60,000 on your Mecklenburg county tax.
- You will automatically get a homestead exemption if you file Chapter 7 or Chapter 13 bankruptcy. While creditors will seize some of your assets to pay off any debt you owe, you can usually keep your home when you file for bankruptcy as long as you keep up with mortgage payments.
Property Tax Exemptions for Seniors and the Disabled People
If you’re 65 or older or are totally and permanently disabled, you can qualify for a property tax exemption.
With this tax exemption, you won’t pay taxes on 50% of the assessed value of your home or $25,000, whichever is greater. However, you have to meet specific income requirements to qualify if you are disabled.
You can qualify for this property tax exemption if your income is less than $31,900 a year. Your income includes Social Security benefits, payments from annuities and retirement accounts, insurance policies, interest, and more. However, it doesn’t include gifts and inheritances.
You will need to apply for a property tax exemption with your county. Once you get an exemption, you won’t have to apply again.
If you are disabled, you will need to include a certificate from a doctor who practices in North Carolina. You can also use a certificate from a government agency like the Social Security Administration.
You will have to notify the county assessor if you move or if your income changes. You should also reach out to your county if your disability status changes since you might no longer qualify for the exemption.
Circuit Breaker Program
There is another program you should know about if you’re 65 and live in the city of Charlotte or the Charlotte area. There is a Circuit Breaker Program you can apply for if you want to defer property taxes.
This program allows you to defer a portion of your property taxes. You can defer a part of the county property tax that corresponds to 4% of your annual income if you earn less than $31,900. If you make between $31,900 and $46,850, you are eligible to defer 5%.
This program will lower your property tax bill, but you should keep in mind that you’re deferring these taxes. These taxes become a lien on your property and become due if the owner dies, you sell or transfer the property, or you stop using the property as your primary home.
Property Tax Exemption for Disabled Veterans
Disabled veterans qualify for a larger exemption compared to other disabled individuals. Instead of an exemption of 50% of the value of your property or $25,000, you can get one for up to $45,000. This provision also applies if you’re the surviving spouse of a disabled veteran.
There are a few conditions you’ll have to meet to qualify. You can get this property tax exemption if you received an honorable discharge at the end of your service. Your disability must be total and permanent, directly resulting from your service.
You’ll have to file an Application for Property Tax Relief Form AV-9 to have the Department of Veteran Affairs review your application and certify that your disability is a result of your service.
Property taxes are one of the many things you’re responsible for as a homeowner. It’s essential to keep up with your property tax payments and reach out to your local government if you face problems with filing or paying your property taxes.
Homeowners who can’t keep up with their property tax obligations often end up downsizing and moving into a smaller home with a lower tax bill. However, a property tax lien can make selling your home difficult.
In these situations, consult a tax professional and even a cash homebuyer to explore all your options.