Property Tax Cap AB489 FAQ

All owner occupied homes (including single-family homes, condos, townhouses and manufactured homes) that are used as primary residences qualify for the 3% tax cap. Also, rental units may be eligible if all the units are rented for equal to or less than the HUD median market rents, less utilities.

AB 489 provides for a partial abatement of the ad valorem taxes levied in a county. This partial abatement results in a “Tax Cap”. The tax cap will limit the increase of your tax bill to 3% for your primary residence within Nevada or rental properties where the rent charged does not exceed the fair market rent, less utilities, for the county in which the dwelling is located, as most recently published by HUD as provided by the Nevada Department of Taxation. Most other property will receive a higher “Cap”, which, for 2005/2006 will be 7.3% over the previous year’s tax bill in Douglas County.

It does not limit the increase in assessed value.

The exemption will be applied to the tax bill after the cap is applied.

The following situations could cause an increase of more than the prescribed cap:

• An exemption, which was applied to last years tax bill, was removed for the current year.
• There was a change in use for the property such as a zoning change or mobile home conversion.
• There was new construction on the property.
• New, Voter approved increases were levied.

Any property where the percentage of tax increase was less than the corresponding cap will only be billed the original increase of the taxes. The tax bill will not automatically be increased by the corresponding cap.

If you live in the home you own, it is considered your primary residence and therefore qualifies for the 3% tax cap.

For the first year, the property will qualify for the lower cap as long as the main residence is the primary owner occupied residence. This may change in future years when permanent regulations are adopted.

• If you own both the land and the manufactured home, and occupy the manufactured home as your primary residence you are eligible for the 3% tax cap on the land and manufactured home.
• If you own the manufactured home but not the land, the manufactured home is eligible for the 3% tax cap, but not the land.
• If you own the land but not the manufactured home you would be eligible for the 3% tax cap only if the space rent is less than the HUD median market rent, less utilities.
• If you own the land and the manufactured home but they are a rental, you are eligible for the 3% tax cap only if the rent you are charging is equal to or less than the HUD median market rent, less utilities.

A separate post card is mailed for every property that you own:

• For single-family residences, sign and check the PRIMARY RESIDENCE box for the home in which you live and return the card to the Assessor’s office.
• If you rent a single-family residence to another party, then sign and check the RENTAL PROPERTY box and return the card to the Assessor’s office. A follow-up survey asking for rental rates will be sent to all properties that have indicated a rental. The appropriate cap will be determined by the reported rental rate.

Each rental unit on the parcel must be rented for equal to or less than the HUD median market rent, less utilities. All units must qualify.

Yes, property used in the operation of a home business can still be considered as a primary residence.

Mixed-use parcels are not eligible for the 3% tax cap but the 7.3% tax cap would apply.

The transfer of ownership of property will trigger a new post card to be mailed to the new owner to verify the status. The new post cards will be mailed monthly.

The 3% tax cap is applied to your tax amount, not the assessed value of your property.

No, you must sign the post card and, if necessary, the rental questionnaire as the property owner. We can send the documents to you if you call our office at 775-782-9830 and request them or you may come into the office at 1616 8th St., Minden.

No. Any owner or legally authorized agent may sign the postcard.

As long as the residence is the primary residence of a trustee the property will qualify for the 3% cap.

No, only the amount of increase on your tax bill was capped.