Disability and Property Tax Exemptions for Alabama Residents

alabama-tax-exemptionsThe State of Alabama has enacted laws to help the disabled by providing a property tax exemption. Specifically, homeowners who are permanently and totally disabled enjoy the same homestead exemption as those who are over the age of 65, under certain circumstances.

In order to qualify, certain requirements must be met. First, it is up to the individual to request the exemption. That is, the person seeking the exemption has the burden of proving eligibility. The Revenue Commissioner does not have an obligation to prove someone qualifies for the exemption.

Under prior law, the exemption was only available to individuals having a net annual taxable income, for both the person seeking the exemption and his spouse, of $12,000 per year or less. Under the current law, as amended in 2013, there is NO INCOME LIMIT. While the 2013 law kept the income limit for individuals aged 65 or older, the income limit for disabled persons was removed.

There must be proof of total disability. This proof is not required to be in any specific form, but the law provides an easy way to establish total disability. The law provides that a written certification of total disability by any two physicians licensed to practice in the State of Alabama will be sufficient, providing at least one of the physicians is actively providing treatment related to the permanent and total disability. The Alabama Department of Revenue has helpfully provided a downloadable form, which is form PT-PA-1.

Alabama law provides an exemption from the affidavit for certain individuals, and the exemption covers most of the individuals who will receive the exemption. No affidavit is required for any person drawing any pension or annuity from the armed services, or a company, or a governmental agency, including the Social Security Administration, because he or she is permanently and totally disabled. The Department shall AUTOMATICALLY grant such individuals a certificate of permanent and total disability.

The exemption from property taxes is for the principal residence of the person seeking the exemption. Therefore, a vacation home would not qualify. The exemption is only for single-family residences. The exemption covers the principal residence and up to 160 acres of adjoining property. This property tax exemption is documented at Code of Alabama (1975) § 40-9-21. A person who qualifies for the exemption is not required to renew the request for exemption after the initial qualification, but can simply verify the continuing disability by mailing in a form provided from the Tax Assessor/Revenue Commissioner.

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