Here is information on Maryland's homestead deduction: http://www.dat.state.md.us/sdatweb/Homestead_app.htm

Virginia's homestead deduction has a limit of $5,000 in value. You can see what this site wrote about it:

For Virginia, the homestead exemption is limited to $5,000 in value. The exemption does not apply against taxes and debts for purchase or improvement of the homestead. If a husband and wife own a homestead, the law usually requires that both of them sign a conveyance or mortgage regarding the real estate for it to be applicable or enforceable against both spouses. For Virginia, a designation or plat of a homestead may be filed. Virginia Code §34-4 onward.

The "Homestead Deduction" allows you to reduce the assessed value of a property by $60,000 if it's your primary residence. Taking this deduction lowers your taxes, because the taxes are calculated on the assessed value. You can find out more information on the Washington DC homestead deduction here.

Here is an email trail between our company and the title company in reference to the homestead deduction in DC:

We wrote:

----- Original Message -----
To: Traci Hajducsek
Sent: 7/17/2007 9:29:25 AM
Subject: Re: Homestead Deduction

Hi Traci,

Jack would like to know if it's possible to claim the homestead deduction at closing, to reduce the initial taxes due. Could you please "reply to all" with clarification on this? You can see his email below.

Jack, my guess is that it won't help to claim it at closing, because the taxes you're being charged at closing are transfer taxes, not property taxes. You won't get your first property tax bill until later; they're sent out twice a year.

Thanks,

DROdio

Traci responded:

From: Traci S. Hajducsek [mailto:traci@nationaltitlecorporation.com]
Sent: 17 July 2007 14:55
Subject: Re: Homestead Deduction

Jack & Daniel,

Most likely, DC will not reassess this property until Sept. or October, so your tax increase will not show up until the bill you get in late February or March of 2008 which will cover the tax period of 10/1/07 - 3/31/08. I always have our buyers fill out the Homestead Deduction at closing and I will file it with DC for you. However, the figure I provided you includes the Homestead Deduction.

The taxes at closing will show the seller paying for the 2nd half of taxes for the tax period of 4/1/07 - 10/1/07 and you will credit the seller for the period of the settlement date through 10/1/07 at the current rate of the cheaper value.

I hope this helps to clarify things. Please feel free to call or e-mail if you have any further questions.

Traci S. Hajducsek
National Title Corporation
1516 P Street NW
Washington, DC 20005
202-466-6206 Phone
202-466-8924 Fax
TRACI@NATIONALTITLECORPORATION.COM
WWW.NATIONALTITLECORPORATION.COM