Question: Why does my property tax bill show fair cash value and taxable value when both amounts are different? And which amount do I actually pay? Are different people taxed at the two different rates or is only one amount applicable?

Answer: This answer comes from Fayette County Clerk Don Blevins. The fair cash value is the amount that a tax assessor believes a home is worth on the market as of January 1st of each year.

 The Homestead exception, or taxable value, is a statutory discount that provides for lower property tax rates for primary residences for people declared totally disabled or those aged 65 and over. To claim the exemption, the residence must be owned and occupied by the taxpayer on Jan. 1 of each year. Anyone 65 and older gets the exemption merely by claiming it on tax returns, but the disabled people younger than that must make an annual application to their county property valuation administrator’s office.

The discount can be substantial. For example, for a house with a fair cash value of $90,000 for the 2007 tax year, the taxable value would be $58,600 after the discount. According to the Ky Revenue Cabinet Web site, the amount of the homestead exemption is adjusted every two years in accordance with KRS 132.810 to compensate for changes in the purchasing power of the dollar.

The maximum homestead exemption on real estate owned by qualified persons has been set at $31,400 for the 2007 and 2008 tax periods. The 2007-2008 exemption reflects a $2,000 increase over the 2005-2006 exemption of $29,400.

Linda Niemi

Filed under: Lexington info