Should Residents of 55+ Communities Pay Less Property Tax?

Property taxes support a wide variety of local services such as schools, libraries, fire services and more.
Property taxes support a wide variety of local services such as schools, libraries, fire services and more.

Retirees living on a fixed income are sure to be interested in living in an area that has retirement-friendly tax laws. In addition to choosing an area that doesn’t tax pensions or Social Security benefits, older adults can relocate to areas that offer property tax breaks to residents who are over a certain age. Yet, expecting to pay less property tax has led to some controversy with active adults speaking out on both sides of the issue.

How Property Taxes Work

The way property taxes are collected and spent varies by state, county, and municipality. Tax increases are typically the result of voting for special community projects, such as new schools and school budgets, libraries, police departments, and roadways.

Property taxes are based on the assessed value of the home and land, though many areas offer tax relief for senior residents with a lower income either through property tax exemptions or freezes.

Why Active Adults Should Pay Lower Property Taxes

There are many reasons for allowing lower property taxes for older adults. In some cases, tax relief has protected longtime homeowners from being taxed out of their homes after an area’s market value has gone up. In an attempt to avoid these situations, tax relief is designed to help seniors who meet low-income criteria keep their homes.

There are also cases where residents who can afford to pay still feel that they should have lower (or no) payments. One of the most commonly cited reasons revolves around property taxes being used to fund local public school systems. Some 55+ community residents in Arizona felt so strongly about the matter that they voted their communities out of the local school districts and do not pay school taxes at all.

But not every older adult feels that this is the best solution. On the side of reducing school tax for older adults, many empty nesters feel that they should not be paying taxes toward a local school system which their (now adult) children are no longer using. Retirees who relocate to a new area may be even less inclined to pay taxes which support local schools, as they have never raised children in the area.

The Benefits of Paying Property Taxes

However, active adults on the other side of the issue tend to view public education as a responsibility of every citizen in a community, regardless of their own family status.

They may argue that good schools bring in younger families, who stimulate the local economy and, in turn, support senior citizens through their own income taxes (used for Medicare and Social Security). Property taxes may also be used for youth programs in addition to public schools as well, such as recreation centers, sports leagues and counseling for troubled or at-risk kids and teens.

As with school funding, some older adults think these programs should be funded by families with children, while others see them as a benefit to the whole community which could lead to lower crime rates and better community spirit. As with any issue, there are many points to be considered and the best answer is likely striking a balance somewhere in the middle.

Yet, that middle ground can be difficult to find. When it comes to paying property taxes, what do you think? Have you paid enough over the years that you now deserve a break? Or do you think everyone should contribute for the good of the community? We’d love to hear from you in the comments below.

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