Circuit Breakers and Other Income-Based Property Tax Programs in 2023
mapNo tax cut offers a more targeted solution to property tax affordability problems than circuit breaker credits. This is because circuit breakers are the only tools for reducing property taxes that measure the affordability of property taxes relative to families’ ability to pay.
Circuit breakers protect families from property tax “overload” much like how traditional circuit breakers protect against electrical overload. Under most circuit breaker programs, when a property tax bill exceeds a certain percentage of a taxpayer’s income, the circuit breaker reduces property taxes in excess of this “overload” level.
Most states offer some kind of property tax circuit breaker, though they vary widely in size and scope. Currently, 29 states and the District of Columbia offer property tax circuit breaker programs. The most common form of help is a threshold-style circuit breaker. Under this approach, credits or rebates are calculated using a formula that compares property tax liability to income and offsets some or all the property tax that exceeds what is designated as unaffordable under the program.
The map below displays the different types of circuit breakers used across the country. To learn more about these credits, read our report How Property Tax Circuit Breakers Promote Housing Affordability.
