GENERAL ASSEMBLY OF NORTH CAROLINA
SESSION 2025
H 1
HOUSE BILL 432
Short Title: Protect Our Homes Act. (Public)
Sponsors: Representatives Echevarria, Winslow, N. Jackson, and Dixon (Primary
Sponsors).
For a complete list of sponsors, refer to the North Carolina General Assembly web site.
Referred to: Finance, if favorable, Rules, Calendar, and Operations of the House
March 19, 2025
*H432 -v-1*
A BILL TO BE ENTITLED 1
AN ACT TO INCREASE T HE EXCLUSION AMOUNT UNDER THE ELDERLY OR 2
DISABLED PROPERTY TA X HOMESTEAD EXCLUSIO N, TO EXPAND THE 3
DISABLED VETERAN PRO PERTY TAX HOMESTEAD EXCLUSION, TO CREATE 4
THE HOMEOWNER ADVANT AGE PROPERTY TAX REL IEF PROGRAM AND THE 5
ELDERLY PROPERTY TAX HOMESTEAD CIRCUIT BREAKER PROGRAM AND T O 6
MAKE CONFORMING CHAN GES NECESSARY TO IMP LEMENT THOSE 7
PROGRAMS, AND TO CRE ATE EXEMPTIONS TO TH E FORCED SALE OF A 8
HOMESTEAD. 9
The General Assembly of North Carolina enacts: 10
SECTION 1.(a) G.S. 105-277.1 reads as rewritten: 11
"§ 105-277.1. Elderly or disabled property tax homestead exclusion. 12
(a) Exclusion. – A permanent residence owned and occupied by a qualifying owner is 13
designated a special class of property under Article V, Sec. 2(2) of the North Carolina 14
Constitution and is taxable in accordance with this section. The amount of the appraised value of 15
the residence equal to the exclusion amount is excluded from taxation. The exclusion amount is 16
the greater of twenty five thousand dollars ($25,000) (i) fifty thousand dollars ($50,000) or (ii) 17
fifty percent (50%) of the appraised value of the residence. An owner who receives an exclusion 18
under this section may not receive other property tax relief. 19
… 20
(a2) Income Eligibility Limit. – For the taxable year beginning on July 1, 2008, 2026, the 21
income eligibility limit is twenty-five thousand dollars ($25,000). forty-eight thousand dollars 22
($48,000). For taxable years beginning on or after July 1, 2009, 2027, the income eligibility limit 23
is the amount for the preceding year, adjusted by the same percentage of this amount as the 24
percentage of any cost-of-living adjustment made to the benefits under Titles II and XVI of the 25
Social Security Act for the preceding calendar year, rounded to the nearest one hundred dollars 26
($100.00). On or before July 1 of each year, the Department of Revenue must determine the 27
income eligibility amount to be in effect for the taxable year beginning the following July 1 and 28
must notify the assessor of each county of the amount to be in effect for that taxable year. 29
(b) Definitions. – The following definitions apply in this section: 30
… 31
(3a) Property tax relief. – The property tax homestead exclusion provided in this 32
section, the property tax homestead circuit breaker provided in 33
G.S. 105-277.1B, or the disabled veteran property tax homestead exclusion 34 General Assembly Of North Carolina Session 2025
Page 2 House Bill 432-First Edition
provided in G.S. 105-277.1C.G.S. 105-277.1C, the homeowner advantage 1
property tax relief provided in G.S. 105-277.1E, or the elderly property tax 2
homestead circuit breaker provided in G.S. 105-277.1G. 3
…." 4
SECTION 1.(b) G.S. 105-277.1C reads as rewritten: 5
"§ 105-277.1C. Disabled veteran property tax homestead exclusion. 6
(a) Classification. – A permanent residence owned and occupied by a qualifying owner 7
is designated a special class of property under Article V, Section 2(2) of the North Carolina 8
Constitution and is taxable in accordance with this section. The first forty-five thousand dollars 9
($45,000) lesser of (i) fifty percent (50%) of the appraised value of the residence or (ii) one 10
hundred thousand dollars ($100,000) is excluded from taxation. A qualifying owner who receives 11
an exclusion under this section may not receive other property tax relief. 12
…." 13
SECTION 1.(c) Article 12 of Chapter 105 of the General Statutes is amended by 14
adding three new sections to read: 15
"§ 105-277.1E. Homeowner advantage property tax relief. 16
(a) Classification. – A permanent residence owned and occupied by a qualifying owner 17
is designated a special class of property under Article V, Section 2(2) of the North Carolina 18
Constitution and is taxable in accordance with this section. 19
(b) Definitions. – The following definitions apply in this section: 20
(1) Baseline value. – The appraised value of a permanent residence as of January 21
1 of the baseline year. 22
(2) Baseline year. – The first year in which a qualifying owner receives property 23
tax relief under this section. 24
(3) Owner. – Defined in G.S. 105-277.1. 25
(4) Permanent residence. – Defined in G.S. 105-277.1. 26
(5) Rate of inflation. – The percentage change in the Consumer Price Index for 27
All Urban Consumers, U.S. City Average, All Items, as published by the 28
Bureau of Labor Statistics of the United States Department of Labor. 29
(c) Qualifying Owner. – For the purpose of qualifying for the homeowner advantage 30
property tax relief under this section, a qualifying owner is an owner who meets all of the 31
following requirements as of January 1 preceding the taxable year for which the benefit is 32
claimed: 33
(1) The owner has occupied the property as a permanent residence for at least two 34
years immediately preceding the owner's filing for property tax relief under 35
this section. 36
(2) The owner is a North Carolina resident. 37
(d) Limitation. – Except as provided in subsection (e) of this section, the taxable value of 38
the permanent residence of a qualifying owner shall not exceed its baseline value by an amount 39
more than (i) the average rate of inflation per year between consecutive general reappraisals, or 40
three percent (3%) per year, whichever is less, and (ii) fifteen percent (15%) cumulatively. 41
(e) Exceptions. – Except as provided in subdivision (1) of this subsection, the county 42
shall reappraise the permanent residence of a qualifying owner at its true value in a year in which 43
any of the following conditions are met: 44
(1) There is a physical change in the land or to improvements on the land other 45
than a change listed in G.S. 105-287(b); provided that a reappraisal of a 46
permanent residence under this subdivision shall only consider factors that are 47
directly attributable to the change or improvement and shall not consider 48
external market forces or other factors otherwise includable in the 49
determination of true value. A qualifying owner shall provide all relevant 50
documentation necessary for a reappraisal under this subdivision on a form 51 General Assembly Of North Carolina Session 2025
House Bill 432-First Edition Page 3
and in a manner prescribed by the Department. The permanent residence of a 1
qualifying owner who fails to provide necessary documentation under this 2
subdivision may be reappraised at true value. A residence reappraised under 3
this subdivision shall be subject to subsection (d) of this section at the time of 4
subsequent reappraisals conducted pursuant to G.S. 105-286. 5
(2) Except as provided in subsections (f), (i), and (j) of this section, the qualifying 6
owner no longer occupies the residence as a permanent residence. 7
(f) Temporary Absence. – An otherwise qualifying owner does not lose the benefit of 8
this property tax relief because of a temporary absence from his or her permanent residence for 9
reasons of health, or because of an extended absence while confined to a rest home or nursing 10
home, so long as the residence is unoccupied or occupied by the owner's spouse or other 11
dependent. 12
(g) Application. – An application for property tax relief provided by this section should 13
be filed during the regular listing period but may be filed and must be accepted at any time up to 14
and through June 1 preceding the tax year for which the relief is claimed. Persons may apply for 15
this property tax relief by entering the appropriate information on a form made available by the 16
assessor under G.S. 105-282.1. 17
(h) Multiple Ownership. – A permanent residence owned and occupied by a husband and 18
wife is entitled to the full benefit of the property tax relief under this section notwithstanding that 19
only one of them meets the length of occupancy requirement of this section. When a permanent 20
residence is owned and occupied by two or more persons other than husband and wife, no 21
property tax relief is allowed under this section unless all of the owners qualify. 22
(i) Death of Owner. – A permanent residence owned and occupied by a qualifying owner 23
is entitled to the full benefit of the property tax relief under this section notwithstanding the death 24
of the owner provided that (i) the deceased owner's share passes to a co-owner of the residence 25
or to the deceased owner's spouse and (ii) that individual occupies or continues to occupy the 26
property as their permanent residence. 27
(j) Transfer. – A permanent residence owned and occupied by a qualifying owner is 28
entitled to the full benefit of the property tax relief under this section notwithstanding the transfer 29
of the residence by the owner provided that (i) the owner transfers the residence to a co-owner 30
of the residence or, as part of a divorce proceeding, to the owner's spouse and (ii) that individual 31
occupies or continues to occupy the property as their permanent residence. 32
"§ 105-277.1G. Elderly property tax homestead circuit breaker. 33
(a) Classification. – A permanent residence owned and occupied by a qualifying owner 34
is designated a special class of property under Article V, Section 2(2) of the North Carolina 35
Constitution and is taxable in accordance with this section. 36
(b) Definitions. – The definitions provided in G.S. 105-277.1 apply to this section. 37
(c) Income Eligibility Limit. – The income eligibility limit provided in 38
G.S. 105-277.1(a2) applies to this section. 39
(d) Qualifying Owner. – For the purpose of qualifying for the elderly property tax 40
homestead circuit breaker under this section, a qualifying owner is an owner who meets all of the 41
following requirements as of January 1 preceding the taxable year for which the benefit is 42
claimed: 43
(1) The owner has an income for the preceding calendar year of not more than 44
one hundred percent (100%) of the income eligibility limit specified in 45
subsection (c) of this section. 46
(2) The owner has owned the property as a permanent residence for at least 10 47
consecutive years and has occupied the property as a permanent residence for 48
at least 10 years. 49
(3) The owner is at least 85 years of age. 50
(4) The owner is a North Carolina resident. 51 General Assembly Of North Carolina Session 2025
Page 4 House Bill 432-First Edition
(e) Multiple Owners. – A permanent residence owned and occupied by husband and wife 1
is entitled to the full benefit of the elderly property tax homestead circuit breaker notwithstanding 2
that only one of them meets the length of occupancy and ownership requirements and the age 3
requirement of this section. When a permanent residence is owned and occupied by two or more 4
persons other than husband and wife, no elderly property tax homestead circuit breaker is allowed 5
unless all of the owners qualify and elect to defer taxes under this section. 6
(f) Tax Limitation. – A qualifying owner may defer the portion of the principal amount 7
of tax that is imposed for the current tax year on his or her permanent residence and exceeds the 8
percentage of the qualifying owner's income set out in the table in this subsection. If a permanent 9
residence is subject to tax by more than one taxing unit and the total tax liability exceeds the tax 10
limit imposed by this section, then both of the taxes due under this section and the taxes deferred 11
under this section must be apportioned among the taxing units based upon the ratio each taxing 12
unit's tax rate bears to the total tax rate of all units. 13
Income Over Income Up To Percentage 14
-0- Income Eligibility Limit 0% 15
(g) Temporary Absence. – An otherwise qualifying owner does not lose the benefit of 16
this circuit breaker because of a temporary absence from his or her permanent residence for 17
reasons of health, or because of an extended absence while confined to a rest home or nursing 18
home, so long as the residence is unoccupied or occupied by the owner's spouse or other 19
dependent. 20
(h) Deferred Taxes. – The difference between the taxes due under this section and the 21
taxes that would have been payable in the absence of this section are a lien on the real property 22
of the taxpayer as provided in G.S. 105-355(a). The difference in taxes must be carried forward 23
in the records of each taxing unit as deferred taxes. The deferred taxes for the preceding three 24
fiscal years are due and payable in accordance with G.S. 105-277.1F when the property loses its 25
eligibility for deferral as a result of a disqualifying event described in subsection (i) of this 26
section. On or before September 1 of each year, the collector must send to the mailing address of 27
a residence on which taxes have been deferred a notice stating the amount of deferred taxes and 28
interest that would be due and payable upon the occurrence of a disqualifying event. 29
(i) Disqualifying Events. – Each of the following constitutes a disqualifying event: 30
(1) The owner transfers the residence. Transfer of the residence is not a 31
disqualifying event if (i) the owner transfers the residence to a co-owner of 32
the residence or, as part of a divorce proceeding, to his or her spouse and (ii) 33
that individual occupies or continues to occupy the property as his or her 34
permanent residence. 35
(2) The owner dies. Death of the owner is not a disqualifying event if (i) the 36
owner's share passes to a co-owner of the residence or to his or her spouse and 37
(ii) that individual occupies or continues to occupy the property as his or her 38
permanent residence. 39
(3) The owner ceases to use the property as a permanent residence. 40
(j) Gap in Deferral. – If an owner of a residence on which taxes have been deferred under 41
this section is not eligible for continued deferral for a tax year, the deferred taxes are carried 42
forward and are not due and payable until a disqualifying event occurs. If the owner of the 43
residence qualifies for deferral after one or more years in which he or she did not qualify for 44
deferral and a disqualifying event occurs, the years in which the owner did not qualify are 45
disregarded in determining the preceding three years for which the deferred taxes are due and 46
payable. 47
(k) Creditor Limitations. – A mortgagee or trustee that elects to pay any tax deferred by 48
the owner of a residence subject to a mortgage or deed of trust does not acquire a right to foreclose 49
as a result of the election. Except for requirements dictated by federal law or regulation, any 50 General Assembly Of North Carolina Session 2025
House Bill 432-First Edition Page 5
provision in a mortgage, deed of trust, or other agreement that prohibits the owner from deferring 1
taxes on property under this section is void. 2
(l) Construction. – This section does not affect the attachment of a lien for personal 3
property taxes against a tax-deferred residence. 4
(m) Application. – An application for property tax relief provided by this section should 5
be filed during the regular listing period but may be filed and must be accepted at any time up to 6
and through June 1 preceding the tax year for which the relief is claimed. Persons may apply for 7
this property tax relief by entering the appropriate information on a form made available by the 8
assessor under G.S. 105-282.1. 9
"§ 105-277.1H. Property tax relief portability. 10
(a) Purpose. – The purpose of this section is to ensure continuity in property tax relief for 11
new owners of a primary residence by allowing owners to transfer property tax relief to their new 12
primary residence. 13
(b) Definitions. – The definitions provided in G.S. 105-277.1 apply in this section. 14
(c) Portability. – An owner who qualifies for property tax relief may purchase a new 15
primary residence and, notwithstanding the durational residency requirements of 16
G.S. 105-277.1B, 105-277.1E, and 105-277.1G, may continue to qualify for property tax relief 17
provided the owner (i) continues to meet all other requirements for property tax relief and (ii) 18
files an application with the assessor of the county in which the new primary residence is situated 19
in accordance with subsection (d) of this section. 20
(d) Application Required. – In order to transfer property tax relief under this section, an 21
owner shall submit (i) an application in accordance with G.S. 105-282.1(a)(2)g. and (ii) any other 22
relevant documentation that an assessor deems necessary to verify an owner's qualifications for 23
property tax relief portability under this section." 24
SECTION 1.(d) G.S. 105-282.1(a)(2) reads as rewritten: 25
"(2) Single application required. – An owner of one or more of the following 26
properties eligible for a property tax benefit must file an application for the 27
benefit to receive it. Once the application has been approved, the owner does 28
not need to file an application in subsequent years unless new or additional 29
property is acquired or improvements are added or removed, necessitating a 30
change in the valuation of the property, or there is a change in the use of the 31
property or the qualifications or eligibility of the taxpayer necessitating a 32
review of the benefit. The properties are as follows: 33
a. (Effective for taxes imposed for taxable years beginning before 34
July 1, 2022) Property exempted from taxation under G.S. 105-278.3, 35
105-278.4, 105-278.5, 105-278.6, 105-278.7, or 105-278.8. 36
a. (Effective for taxes imposed for taxable years beginning on or 37
after July 1, 2022) Property exempted from taxation under 38
G.S. 105-278.2(a), 105-278.3, 105-278.4, 105-278.5, 105-278.6, 39
105-278.7, or 105-278.8. 40
b. Special classes of property excluded from taxation under 41
G.S. 105-275(3), (7), (8), (12), (17), (18), (19), (20), (21), (31e), (35), 42
(36), (38), (39), (41), (45), (46), (47), (48), or (49) or under 43
G.S. 131A-21. 44
c. (Effective for taxable years imposed for taxable years beginning 45
before July 1, 2019) Special classes of property classified for taxation 46
at a reduced valuation under G.S. 105-277(h), 105-277.1, 105-277.1C, 47
105-277.10, 105-277.13, 105-277.14, 105-277.15, 105-277.17, or 48
105-278. 49
c. (Effective for taxable years imposed for taxable years beginning 50
on or after July 1, 2019) Special classes of property classified for 51 General Assembly Of North Carolina Session 2025
Page 6 House Bill 432-First Edition
taxation at a reduced valuation under G.S. 105-277(h), 105-277.02, 1
105-277.1, 105-277.1C, 105-277.10, 105-277.13, 105-277.14, 2
105-277.15, 105-277.17, or 105-278. 3
d. Property owned by a nonprofit homeowners' association but where the 4
value of the property is included in the appraisals of property owned 5
by members of the association under G.S. 105-277.8. 6
e. Repealed by Session Laws 2008-35, s. 1.2, effective for taxes imposed 7
for taxable years beginning on or after July 1, 2008. 8
f. Special classes of property eligible for tax relief under 9
G.S. 105-277.1E. 10
g. Property that qualifies for property tax relief portability under 11
G.S. 105-277.1H." 12
SECTION 1.(e) G.S. 105-283 reads as rewritten: 13
"§ 105-283. Uniform appraisal standards. 14
All Except as provided in G.S. 105-277.1E, all property, real and personal, shall as far as 15
practicable be appraised or valued at its true value in money. When used in this Subchapter, the 16
words "true value" shall be interpreted as meaning market value, that is, the price estimated in 17
terms of money at which the property would change hands between a willing and financially able 18
buyer and a willing seller, neither being under any compulsion to buy or to sell and both having 19
reasonable knowledge of all the uses to which the property is adapted and for which it is capable 20
of being used. For the purposes of this section, the acquisition of an interest in land by an entity 21
having the power of eminent domain with respect to the interest acquired shall not be considered 22
competent evidence of the true value in money of comparable land." 23
SECTION 1.(f) G.S. 105-284 reads as rewritten: 24
"§ 105-284. Uniform assessment standard. 25
(a) Except as otherwise provided in G.S. 105-277.1E and in this section, all property, real 26
and personal, shall be assessed for taxation at its true value or use value as determined under 27
G.S. 105-283 or G.S. 105-277.6, and taxes levied by all counties and municipalities shall be 28
levied uniformly on assessments determined in accordance with this section. 29
…." 30
SECTION 1.(g) G.S. 105-309(f) reads as rewritten: 31
"(f) The assessor must print a homestead tax relief notice on each abstract or on an 32
information sheet distributed with the abstract. The abstract or sheet must include the address 33
and telephone number of the assessor below the notice required by this section. The notice must 34
be in the form required by the Department of Revenue designed to notify the taxpayer of his or 35
her rights and responsibilities under the homestead property tax exclusion provided in G.S. 36
105-277.1 and G.S. 105-277.1, the property tax homestead circuit breaker provided in G.S. 37
105-277.1B.G.S. 105-277.1B, the homeowner advantage property tax relief provided in 38
G.S. 105-277.1E, and the elderly property tax homestead circuit breaker provided in 39
G.S. 105-277.1G." 40
SECTION 2. Article 16 of Chapter 1C of the General Statutes is amended by adding 41
a new section to read: 42
"§ 1C-1605. Homestead exemption from forced sale. 43
(a) This section applies to real or personal property owned by a debtor that the debtor has 44
used as the debtor's primary residence for a period of at least 40 consecutive months from the 45
date of purchase of the property for claims in bankruptcy or 24 consecutive months from the date 46
of purchase of the property for all other claims. 47
(b) A judgment entered against the owner of property subject to this section may be 48
placed as a lien against the property, but the property is exempt from forced sale under Article 49
29B of Chapter 1 of the General Statutes or any other provision of State law. The lien may be 50
enforced any time ownership of the property is transferred. 51 General Assembly Of North Carolina Session 2025
House Bill 432-First Edition Page 7
(c) The exemption of subsection (b) of this section is inapplicable to claims: 1
(1) Of the United States or its agencies as provided by federal law. 2
(2) Of the State or its subdivisions for property taxes, appearance bonds, or 3
fiduciary bonds. 4
(3) Of lien by a laborer for work done and performed for the person claiming the 5
exemption, but only as to the specific property affected. 6
(4) Of lien by a mechanic for work done on the premises, but only as to the 7
specific property affected. 8
(5) For payment of obligations contracted for the purchase of the specific real 9
property affected. 10
(6) For payment of overdue obligations, fines, or assessments due to a 11
homeowners' association. 12
(7) Of a creditor for any debt if a judgment for the debt was entered against the 13
property owner prior to the twenty-fourth month of consecutive ownership." 14
SECTION 3. The Department of Revenue (Department) shall study ways to abolish 15
the statutory framework for the listing, appraisal, and assessment of real property under Chapter 16
105 of the General Statutes and shall develop a framework to eliminate property taxes on real 17
property in this State. The Department shall develop a framework to replace property tax 18
revenues through State and local budget reductions, sales-based consumption taxes, and locally 19
determined consumption taxes. The study must include, at a minimum, the following 20
information: 21
(1) An analysis of the potential impact of eliminating property taxes on public 22
services, including education, infrastructure, and emergency services. 23
(2) An assessment of potential housing market fluctuations, including changes in 24
homeownership rates and property values. 25
(3) An evaluation of whether a shift to consumption-based taxes would make 26
North Carolina more attractive to businesses compared to other states. 27
(4) An analysis of the potential impact of eliminating property taxes on overall 28
economic stability, consumer behavior, and long-term economic growth. 29
The Department may consult with any other relevant State, local, or private entity in 30
conducting the study required by this section. The Department shall report its findings to the Joint 31
Legislative Oversight Committee on General Government by February 1, 2026. 32
SECTION 4. Section 1 of this act is effective for taxes imposed for taxable years 33
beginning on or after July 1, 2026. Section 2 of this act is effective beginning October 1, 2025, 34
and applies to judgments entered against a debtor on or after that date. The remainder of this act 35
is effective when it becomes law. 36