In her more than 30 years as a realtor, Terrie Cox, PC has received many questions about income tax exemptions in the State of Washington. Not only does Washington not have state income tax, but the state also offers a variety of tax exemptions, credits, and assistance benefitting a range of luxury home shoppers and owners.
No Taxes on Income, but Others Elsewhere
Washington’s income tax exemptions regularly win the state spots on “Best Places to Retire” lists. It’s true: the state is among those that do not collect taxes on retirement checks. But it’s also worth mentioning that Washington, compared to the rest of the United States, has relatively high sales and property taxes. Still, retirees can apply for special relief programs to cut their property tax burdens.
Some Can Avoid Full Property Tax Burden
Property tax rates depend on the budget, voter-approved levies, and bonds in a property’s district. Fortunately, Washington offers a number of income tax exemptions and assistance options. Senior citizens and residents with disabilities, for example, can apply to “freeze” the value of their home, exempting them from excess levies and, potentially, a portion of regular levies. Widows and widowers of veterans may also be eligible for property tax assistance. The state’s Department of Revenue outlines the conditions, contacts, and necessary applications for the various programs.
Add a Room, Get a Break
Homeowners who add a new room, deck, or patio to their single-family homes may qualify for a three-year tax exemption on the value of those improvements, which is excellent news for affluent homeowners. To find out if your planned renovations will qualify for savings tax exemption, call your county assessor’s office and file an application. Applications generally must be filed before you begin improvements but after you’ve obtained the appropriate building permits.
Energy-Efficient Homes Downsize Tax Bills
Aligning with the Pacific Northwest’s environmentally conscious reputation, the Federal Housing Administration’s energy-efficient mortgage programs incentivize eco-friendly home improvements. These programs help buyers save money on utility bills by folding the cost of improvements into the purchase of their homes. These programs also include operational savings from the purchase of an energy-efficient home, and buyers may qualify for discounted loan fees or lower mortgage interest rates.
Explore the Market with Terrie Cox, PC
With the combination of income tax exemptions, incentives, and credits available in Washington, you may be unsure which benefits apply to you. Terrie Cox, PC is an experienced, world-ranked realtor who is prepared to help answer your questions. Call or text Terrie directly at (360) 607-4100 to find the luxury home that fits your lifestyle.