Oak Bluffs is holding a public forum for summer taxpayers Tuesday. Each year, the town holds the forum for seasonal residents to meet selectmen and assessors and ask questions about taxes. The forum will be held Tuesday, Aug. 12, at 5:30 pm in the library meeting room at the Oak Bluffs Public Library.
With Oak Bluffs exploring the possibility of implementing residential exemptions, which would reduce the taxable value of all residential parcels that are determined to be the domicile of the owner, this year’s forum takes on new implications for those seasonal property owners.
Under Massachusetts law, a person may have many residences, but only one domicile
Newly minted principal assessor MacGregor Anderson gave an informative presentation to selectmen last month on the exemptions. Anderson also laid out the fundamentals of the exemption in a paper submitted to selectmen.
In Massachusetts, selectmen have the option of granting residential exemptions at their annual tax-rate hearing. Oak Bluffs has never offered a residential exemption to its residents.
Many factors influence property taxes. Selectmen can decide on a residential exemption, but can also set different tax rates for commercial, industrial, personal property, and they can grant discounts to open space or small businesses.
Tisbury is the only town on the Island, offering an 18 percent exemption. In recent years, towns on the Cape like Provincetown, Barnstable, and Truro have adopted the exemption. Nantucket has a 25 percent residential exemption.
For example, selectmen could grant a $50,000 exemption. If a person owns a home assessed at $500,000, they would only be taxed on $450,000. Massachusetts allows for a range of exemption amounts ranging from zero to 35 percent of the average residential property value.
Anderson estimates there are 1,650 properties in Oak Bluffs that would qualify for the exemption.
Anderson and the assessors office modeled impacts of a residential exemption on the estimated number of qualifying properties, but definite impacts are impossible to know until a concrete qualification number is provided.
A property tax exemption increases the tax rate for all residential property. The majority of homeowners would see lower total taxes due, but some residents with higher value properties would pay more through the tax rate increase than they gain from the exemption — this is called a breakeven.
Anderson estimates this would mean higher taxes for residents with properties assessed above $1.75 million regardless of the exemption amount.
While a small number of residents and other groups would be negatively affected, most homeowners would enjoy substantial savings.