Understanding homestead exemptions
A homestead exemption is a legal provision offered at the federal and state levels. It can bring a range of protections to homeowners, including a reduction in tax liability. A homestead exemption can also block the forced sale of your home if you're in a tough place, especially following the death of a spouse or if you're disabled.
Protections vary dramatically from state to state. Some states, like New Jersey, have no homestead exemption at all. In these cases, a federal homestead exemption can apply to homeowners. But in general, state exemptions tend to be more generous. It's important to note that homestead exemptions only apply to a person's primary residence and not any additional properties they may own, even if one is a part-time residence.