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HB 432

Property Tax Relief Study.

2025-2026 Session Introduced by Jay Adams and 16 co-sponsors

HB 432 directs a study to evaluate and propose ways to expand property tax relief for low-income, elderly, disabled homeowners and disabled veterans, including potential reforms an

Regular Message Received From House
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Bill Summary · HB 432

Summary — HB 432: Property Tax Relief Study

Status: Second Edition (House Bill) — Directs study by the Revenue Laws Study Committee
Introduced: March 19, 2025 (text as of Edition 2)
Subject areas: property tax relief for elderly, disabled, and disabled veterans; potential property tax reforms; revenue and local government impacts

Purpose / Intent

HB 432 directs the Revenue Laws Study Committee to conduct a comprehensive review of North Carolina’s existing property tax relief programs for elderly, low‑income, disabled homeowners, and disabled veterans. The goal is to identify options to reduce property tax burdens for those groups and to evaluate other reforms that could mitigate property tax pressure while considering effects on local government revenues.

Key provisions

  • Directs the Revenue Laws Study Committee to study current property tax relief programs, specifically:
    • Elderly or disabled property tax homestead exclusion (G.S. 105‑277.1)
    • Property tax homestead circuit breaker (G.S. 105‑277.1B)
    • Disabled veteran property tax homestead exclusion (G.S. 105‑277.1C)
  • Tasks the Committee to evaluate specific options to enhance relief, including (but not limited to):
    • Increasing exclusion amounts
    • Raising income eligibility thresholds or reconsidering the definition of “income”
    • Modifying circuit breaker design (deferred tax obligation, age/disability criteria), raising income limits, or tying limits to area median income
  • Directs examination of broader homeowner relief mechanisms, such as:
    • Limits on year‑to‑year property tax or valuation increases
    • Alternative payment plans for homeowners
    • Annual statistical adjustments to smooth valuation changes between reappraisals
  • Requires the Committee to examine whether the state constitution’s uniformity requirement (Article V, Section 2) should be amended to allow counties flexibility to adopt some of these changes locally
  • Directs assessment of fiscal impacts on local ad valorem revenues and whether the State should reimburse or grant additional revenue authority to local governments to offset potential revenue losses
  • Instructs the Committee to review property tax relief programs in other states and to consult with relevant state/local stakeholders (e.g., NC Association of County Commissioners, NC League of Municipalities, Department of Revenue)

Who is affected

  • Primary focus: low‑income, elderly, disabled homeowners, and disabled veterans who currently rely on state/local property tax relief programs
  • Secondary stakeholders: county tax assessors, local governments (counties/municipalities) that administer property tax systems and could face revenue impacts from changes; state agencies (Department of Revenue)
  • The public and legislators as recipients of the Committee’s findings and any proposed statutory or constitutional changes

Timeline / Procedural aspects

  • The Committee must complete the study and report findings and any legislative recommendations to the 2026 Regular Session of the General Assembly.
  • This bill is a study/directive only; it does not itself change tax law or appropriate funds. Any policy or fiscal changes would require separate legislation following the Committee’s report.
  • The bill authorizes the Committee to consult other entities and solicit input as needed during the study.

Fiscal and policy implications (overview)

  • Direct fiscal effect: none (study only).
  • Potential future impacts: depending on recommendations and subsequent legislation, enhanced property tax relief could reduce local ad valorem revenues and may prompt consideration of State reimbursement, compensation mechanisms, or new local revenue authorities.

For stakeholders seeking more detail, the bill lists specific statutory sections to be reviewed and explicitly contemplates constitutional issues (uniformity) and practical tools (circuit breaker design, valuation growth limits, payment alternatives) to reduce homeowner property tax burdens.

Compiled from official sources — confirm details with the bill’s official record.

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