What Is the Homeowners Exemption and How Do I File for It in Orange County?

What is the Homeowners' Exemption, and how do you file for it in Orange County? It's a California property tax exemption for people who own and live in their home, and in Orange County you file it with the County Assessor using a short form.

I'm Jeanette Nelson, a REALTOR® with Jeanette Nelson Real Estate, Keller Williams Realty, serving Orange County, Huntington Beach, Costa Mesa, Fountain Valley, and surrounding areas. This is one of the first things I remind new owners about after closing, because it's easy to set aside and easy to miss.

The California State Board of Equalization describes it as a $7,000 reduction in the taxable value of a qualifying owner-occupied home. The Orange County Assessor gives an example: a home with a taxable value of $250,000 would be taxed on $243,000 instead.

This article is general information, not tax advice. For your own situation, please talk with a CPA or call the Assessor's office.

The Orange County Assessor lists three requirements:

• You own the home.
• It's your principal residence on January 1 at 12:01 a.m.
• You don't claim the exemption on any other property.

It's for your main home only. A second home or a rental doesn't qualify.

The Assessor says the exemption saves at least $70 per year. It shows up as a $7,000 reduction in assessed value on your annual value notice and your property tax bill.

1. Watch your mail after closing. The Assessor's FAQ says new owners usually receive an application about three months after the deed is recorded. The Assessor's office pre-fills it with your property and sale information.
2. Complete and sign the form. The state form is BOE-266, the Claim for Homeowners' Property Tax Exemption.
3. Return it to the Orange County Assessor as the form directs.
4. Call if it doesn't arrive. If you bought more than 90 days ago and never received the form, the Assessor's FAQ says to call 714.834.3821.

The Assessor's FAQ notes that claim forms and Social Security numbers are kept confidential. The number is used to confirm you aren't claiming the exemption on more than one home.

• February 15 at 5:00 p.m. File by this date to receive the full $7,000 exemption for that year.
• February 16 through December 10. A late claim may qualify for 80% of the exemption, which the Assessor lists as $5,600.

You don't need to refile every year. The Assessor's FAQ says the exemption continues automatically while you own and live in the home. If a recorded document changes how title is held, you may need to file again.

When you buy, your home is reassessed, and the Orange County Treasurer-Tax Collector explains that new owners usually receive a supplemental tax bill. The Treasurer-Tax Collector also notes that mortgage companies don't usually pay supplemental bills, so plan to pay it yourself.

My article on how property taxes are set when you buy explains the full picture. If you're working through a list of tasks after closing, my article on your first 30 days as a homeowner puts this in order with the rest.

The exemption only applies while the home is your principal residence. If you sell, move out or turn it into a rental, you need to tell the Assessor. The Assessor's page says to submit the termination notice by December 10 to end the exemption without a penalty.

If you're getting ready to buy your first home, I'd be glad to talk through the costs of owning, including property taxes and this exemption, before you start touring. Call or text me at 714.366.8575 | DRE: 01397168, or contact me. Jeanette Nelson is a REALTOR® with Jeanette Nelson Real Estate, Keller Williams Realty, serving Orange County, Huntington Beach, Costa Mesa, Fountain Valley, and surrounding areas.