Since 2001, seniors who have owned and lived in their Colorado home for at least 10 years have enjoyed for a discount on their property taxes — when the state budget allows for it. For the current tax year, the exemption applies to 50% of the home’s actual value up to $200,000. To qualify, a senior must be 65 or over for the entire tax year and must have lived in (and owned) the property as his/her primary residence for 10 years prior to that tax year. A surviving spouse of a senior who previously qualified also qualifies for this “homestead exemption.”
What I have never liked about this exemption is that it penalizes a senior who makes a reasoned decision to sell their long-time family home and downsize. That senior’s property tax burden could increase if he/she sold a too-big home for a right-size home with a lower valuation. How fair is that?
Years ago, I spoke with legislators about amending this provision of our constitution to encourage rather than penalize downsizing and was told that such a change would not pass. (It would have to be a constitutional amendment.)
It should be noted that under this law, the local jurisdictions still receive the full property tax for qualifying properties, because the state pays the exempted amount. That’s why the General Assembly can vote to suspend the exemption in a year when the budget can’t support its cost.