This November, as Pennsylvania voters head to the polls, they will decide whether or not to increase the homestead/farmstead exclusion from 50 percent to 100 percent.
First, what is the homestead/farmstead exclusion? In 1998, Pennsylvania amended their state constitution to provide property tax relief to homeowners via gaming funds. This is called the homestead/farmstead exclusion. It is determined by the amount available from gaming revenue and differs from school district to school district through millage rate reductions. For example, if your property is assessed at $100,000 and the exclusion for your school district is $5,000, then you would only pay taxes on an assessed value of $95,000.
Currently, the exclusion is capped at 50 percent, and the revenue provided does not come close to offsetting 50 percent of property taxes.
This year’s ballot measure, if enacted, would increase the 50 percent cap to 100 percent.
This change would allow the state to pass legislation and identify a revenue source that could provide enough funds to completely offset property taxes. However, do not confuse this with elimination. Pennsylvania, which is currently facing a significant budget shortfall, would need to increase their financial support significantly to districts to offset any additional property tax reductions. It is also important to note that this does not institute a new way to fund schools, instead it is just increasing the cap that is already in existence.
Please see the infographic below for additional information and feel free to share this with other voters.
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