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Property Tax Reimbursement Definitions

Property tax is the amount due and paid for any year on a homestead before subtracting any deductions or reimbursements, not including special assessments, interest, and penalties for delinquent taxes. For mobile home owners it means 18% of the annual site fees paid to the owner of a mobile home park. Any amounts received as a homestead benefit, whether credit or check, does not affect the property tax due and paid.

Base year is the first year the applicant meets all the eligibility requirements. For a resident who first became eligible between January 1, 1997, and December 31, 1997, the base year is 1997. For an applicant who first became eligible after December 31, 1997, the year in which he or she becomes eligible will be the base year.

Property tax reimbursement is the payment of the difference between the amount of property taxes due and paid in the base year (i.e., 1997 or the year the applicant first met all the eligibility requirements) and the property taxes in any other subsequent year, if the latter amount is higher. However, the total of all property tax relief benefits received (property tax reimbursement, homestead benefit, property tax deduction for senior citizens/disabled persons, and property tax deduction for veterans) cannot exceed the amount of property taxes (or rent/mobile home park site fees constituting property taxes) paid on an applicant’s principal residence for the same year.

Under New Jersey law, if an applicant receives a property tax reimbursement that is larger than the amount for which they are eligible, the applicant will be required to repay any excess received. The amount owed can be deducted from any property tax reimbursement, income tax refund or credit, or homestead benefit before the payment is issued.

Homestead must be the applicant's principal residence (actually and continually occupied as his or her permanent residence) which constitutes the applicant's domicile and can be:
  1. A dwelling house and the land on which it is located that is owned by the applicant;
  2. A site in a mobile home park equipped for installation of mobile homes;
  3. A dwelling house owned by the applicant which is on land owned by someone else;
  4. A condo unit or a unit in a horizontal property regime or a continuing care retirement community which is owned by the applicant; or
  5. A unit in a co-op or mutual housing corporation occupied by a applicant who is a residential shareholder or lessee therein, or by a lessee or shareholder who is not a residential shareholder.
Multiple Owners. If the property is held by the applicant with others as tenants in common or joint tenants (except in the case of husband and wife/civil union partners), the applicant is only eligible for the proportionate share of the reimbursement which reflects his or her percentage of ownership.

Multiple Units. As a homeowner, an applicant may apply for a property tax reimbursement on his or her property only if it contains four units or less. Of these four units, only one may be used for commercial purposes. The applicant is only eligible for the proportionate share of the reimbursement which reflects the percentage of the property used as his or her principal residence.

Last Updated: Thursday, 02/16/12

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