In Georgia, two statewide property tax-related bills passed in the November 5, 2024 election: Georgia Amendment 1 and Referendum A. Both will go into effect on January 1, 2025.
The amendment and referendum aim to reduce the burden of property taxes for homeowners.
In this article, we’ll explain these laws and their impact on Georgians' property taxes, finances, and communities in 2025 and beyond.
Georgia Amendment 1
Bill Overview
Georgia Amendment 1, also called House Resolution 1022, is an amendment to Georgia’s Constitution. It started as Georgia House Bill 581 (HB 581), which passed in Georgia’s Congress. Georgians then voted on Amendment 1 or House Resolution 1022 in the November 5 election, which enabled House Bill 581 to be enacted.
Amendment 1 aims to provide a general law for statewide local-option homestead exemptions from ad valorem taxes.
Under the amendment, exemptions must be uniformly applicable to each county, consolidated government, municipality, and local school system. However, the amendment allows these entities to opt out of the homestead exemption.
Passed or Failed
Georgia voters passed the amendment overwhelmingly at nearly 63% (3,091,461 votes) versus the 37% against (1,821,822).
Even beforehand, the then-house bill (HB581) passed with little to no opposition in the state’s House in February 2024 (168-0) and was then approved by the Senate in March 2024 by a vote of 42-11.
Impact
The amendment introduces a new “floating” homestead exemption that caps property tax increases for homeowners based on the statewide inflation rate.
What’s confusing is that the state of Georgia doesn’t actually collect and gain from property taxes; local governments do. Thus, local governments can choose to opt out of this homestead exemption by March 1, 2025, but the process is arduous. Local governments must advertise and conduct three public hearings on workdays before their March 1, 2025 decision is made.
If enacted by local governments, homeowners will see reduced property taxes. Currently, 36 of Georgia’s 159 counties already have homestead exemptions that freeze the valuation of property taxes. It’s unclear how many counties and school districts will adopt this new homestead exemption. It depends heavily on each one’s current financial situation, ability to hold public meetings and make a decisive decision.
Why might local counties, cities, or school districts opt out?
They might not have enough people or industry to afford current and future school and infrastructure projects, so they rely heavily on their residents’ property taxes.
Depending on how many local counties opt out of this floating homestead exemption, it could negatively affect local areas' ability to fund school renovations, new buildings, and infrastructure.
To offset this potential revenue drop from a decrease in property taxes, counties could use a floating local sales tax (FLOST), which would increase sales taxes for all purchased goods and services in a county by one cent.
Georgia Referendum A
Bill Overview
Georgia Referendum A, or the Personal Property Tax Exemption Increase Measure, would increase the assessed value of tangible personal property from $7,500 to $20,000 on January 1, 2025. However, motor vehicles, trailers, and mobile homes are exempt from personal property.
Homeowners and property owners would not have to pay county property taxes on property valued up to $20,000.
Passed or Failed
First introduced in the House as House Bill 808 (HB 808), it passed the Georgia House of Representatives 125-42 in February 2024. A month later, the Senate passed the measure with a 51-0 vote, and Georgia’s Governors signed the bill on May 6, 2024, putting it to a vote by the people of Georgia.
During the November 5th election, Georgia voters passed the referendum at over 64.48% (3,220,903 votes) versus the 35.52 % against (1,774,050).
Impact
Overall, this would help homeowners and small businesses affected by the rise in property taxes, inflation, and general costs over the past few years.
On the other hand, counties would lose revenue. According to Reason Foundation, the combined revenue loss from all 123 Georiga counties could be near $250 million. This loss in revenue would likely be felt most in school districts and counties’ infrastructure, which rely heavily on property taxes.
Other proponents argue that the revenue loss could also be offset by the referendum’s ability to encourage more businesses to relocate to Georgia and provide additional jobs and local revenue. Furthermore, some counties might hike the mileage rate to offset some of this revenue loss.
How Ownwell Helps You Save
Navigating these two statewide property tax laws and their impact on your home or business’s property taxes can feel overwhelming.
Our mission is to make the cost of real estate more clear and equitable. Hopefully, this article has helped us achieve that for you.
And remember, if you're a property owner in Georgia, you don’t have to accept your new tax rate as final!
Ownwell can protest your property taxes for home and property owners in Georgia, reducing another financial burden. On average, 86% of our clients receive a reduction, and those 86% average $1,148 in savings.
If you’re a commercial real estate owner, we save our clients 31% more than our competitors.
See how much Ownwell can save you on property taxes!
