Travis Bunn

Founder, AppealDesk · Published September 10, 2026

Property Tax Deferral: How It Works and Which States Offer It

Updated September 2026 · 14 min read

What Property Tax Deferral Actually Is

A property tax deferral is not a discount. It is a government-sanctioned loan against your home equity. Instead of paying your annual property tax bill out of pocket, the state or county covers it for you, or simply pauses collection, records a lien or protected claim for the amount, and lets the balance grow with interest until a triggering event, typically the sale of the home, a transfer of title, or the owner's death, forces repayment. This is fundamentally different from the other two ways states reduce a homeowner's tax burden: a homestead exemption permanently shrinks your taxable value, and an assessment freeze locks your value in place. Deferral does neither. It just delays the bill, at a price.

Deferral is also completely different from simply not paying your property taxes. Deferral is a formal, approved program: you apply, you qualify, and the government agrees in advance to hold off on collection while interest accrues at a published, capped rate. Skipping your tax bill without enrolling in a deferral program triggers penalties, much higher interest, and eventually a tax lien sale or foreclosure, on a much faster and less forgiving timeline. If you are behind on taxes and weighing your options, see our breakdown of what happens if you don’t pay your property taxes before you decide, the two paths lead to very different outcomes.

Every state runs its deferral program differently, and the differences are not cosmetic. Some programs cap how much you can defer against your home's equity, others secure the loan purely with a lien and no separate equity test. Some charge a rate fixed by statute, others reset annually off a market benchmark. Program terms, income limits, and interest rates are typically reset every year, so always confirm the current details with the administering office before applying rather than relying on last year's figures.

How a Deferral Works, Step by Step

The math matters. A homeowner who defers $3,000 a year for 10 years at 6% simple interest does not just owe $30,000 when the bill comes due. If each year's $3,000 is deferred at the start of the year and the balance is repaid at the end of year 10, they owe $39,900; if each deferral lands at the end of the year instead, $38,100. Either way, interest builds on every year's deferred amount separately. Deferral makes sense for someone who plans to stay in the home long-term and needs the cash flow now. It is a much harder sell for someone who expects to sell or pass the home to heirs soon, since the balance lands on that transaction.

Property Tax Deferral by State: 6 Programs Compared

These are six states with a documented, state-level deferral program. This is not an exhaustive 50-state list, several states leave deferral up to individual counties or have no program at all, and the figures below change annually. Confirm current numbers with the administering office linked for each state before applying.

Beyond these six, several other states authorize deferral at the local or county level rather than through a single statewide program, meaning availability and terms can differ from one county to the next within the same state. If your state is not listed above, ask your county assessor or treasurer directly whether a local deferral option exists.

A Closer Look at Each Program

Oregon: Tested Against Real Market Value, Not Assessed Value

Oregon's Senior and Disabled Property Tax Deferral Program (ORS 311.666-.701) is one of the most established in the country, and it's easy to describe its eligibility test incorrectly: it is not a straight assessed-value cap. The state tests your home's real market value against a limit set separately for each county, with a relaxed alternative (150% of the county's median residential value) for owners in the home under 17 years, and a $301,000 statewide floor for 2026 underneath both. Applicants must be 62 or older, or receiving Social Security disability benefits, have lived in the home at least 5 years, and have 2026 household income of $70,000 or less. The Department of Revenue pays your county property taxes directly, then places a lien on the property, at 6% simple annual interest, fixed by statute rather than reset yearly. Participants must recertify every two years. Applications are due April 15, with a late window through December 1 for a fee. When a disqualifying event occurs (death, sale, or the home no longer being your homestead, with a health-related-absence exception), the full deferred balance plus interest is due by August 15 of the following year, not immediately.

Washington: Two Different Programs, Easy to Conflate

Washington's senior/disabled deferral program (RCW 84.38) is open to homeowners a year younger than its own separate senior exemption, 60 versus 61, or to anyone retired due to disability, with income at or below the county's Deferral Threshold rather than a single statewide figure. That threshold is currently set at roughly 75% of county median household income (through the 2026 cycle), rising to 90% starting with taxes levied in 2027. Rather than testing assessed or market value directly, the program caps how much you can defer at up to 80% of your equity in the home. Deferred amounts accrue 5% simple interest, and the state requires proof of adequate homeowner's insurance with the state listed as loss payee. Repayment is triggered by sale, death (unless a qualifying surviving spouse or domestic partner 57 or older is on title and continues it), condemnation, the home no longer being your primary residence, or failing to meet any of the program's conditions.

Washington also runs a second, separate deferral, RCW 84.37, open to homeowners of any age with limited income, no senior or disability requirement, but a lower 40% equity cap and its own income threshold. If you don't qualify for the 60+/disabled program, check with your county assessor about this one before assuming Washington has nothing to offer you.

California: The Rate Dropped in 2020, and the Filing Window Is Seasonal

California's Property Tax Postponement (PTP) Program, run by the State Controller's Office, currently charges 5% simple interest, computed monthly, not the 7% rate the program used before Assembly Bill 133 lowered it effective July 1, 2020. It requires at least 40% equity in the home, which rules out recent buyers with a large mortgage balance, and 2025–26 household income of $55,181 or less. Note the seasonality: PTP does not accept applications year-round. The 2025–26 filing window ran October 1, 2025 through February 10, 2026 and has already closed; a new window and income figure open each October 1, and you must reapply every year, this is never a one-time enrollment. Postponed taxes come due on sale or transfer, moving out, death, a refinance or reverse mortgage, defaulting on a senior lien, or letting a later year's taxes go delinquent.

Texas: Two Different Deferrals, Two Different Rates

Texas Tax Code §33.06 works differently from the other states here: instead of an agency paying your bill, you file a deferral affidavit (Comptroller Form 50-126) directly with your county appraisal district, which pauses collection and lawsuits on both current and prior delinquent taxes. It's open to homeowners 65 and older, disabled homeowners, and qualified disabled veterans (plus a surviving spouse in some cases), at 5% simple annual interest, well below the standard delinquency penalty and interest rate the county would otherwise charge. Once the homeowner no longer owns or occupies the home, the taxing unit can resume collection 181 days after sending a delinquency notice.

A second, separate provision, §33.065, is open to a homestead owner of any age and defers tax on the portion of your appraised value that exceeds 105% of last year's value plus new improvements, at 8% simple interest. That 8% rate has stayed put since 2019; a bill that would have lowered it to 5% died in committee and never became law, so don't assume it has come down to match §33.06. This deferral ends when you no longer own and occupy the home, or if taxes on the non-deferred base value themselves go delinquent.

Colorado: The General Track Is Gone

Colorado's deferral program changed materially in 2025. Senate Bill 25-261, effective July 1, 2025, eliminated the general-purpose track that had briefly let any owner-occupant whose tax bill rose 4% or more defer regardless of age, and returned application administration to county treasurers (the state Department of the Treasury still services the loans centrally, but no longer takes applications directly). Eligibility today is limited to homeowners 65 or older or those called into active military service, and there is an equity test: for seniors, all liens, mortgages and deeds of trust together can be at most 75% of the home's actual value (for military applicants, 90% including deferrals, or 100% with a VA-backed loan), and no reverse mortgage can exist on the property. The interest rate resets every May off the 10-year Treasury note yield published in the Wall Street Journal each February 1, currently 4.238% simple for the loan year running May 1, 2026 through April 30, 2027. Applications run January 1 through April 1, and existing participants must reapply every year to keep deferring (or notify the state to opt out). Non-qualifying repayment triggers (sale, transfer, rental use, or taking out a reverse mortgage) generally require repayment within 90 days; on the borrower's death with no surviving spouse, the balance is due within a year. A surviving spouse may be allowed to continue the deferral (Treasury's FAQ describes a spouse 60 or older who is on the title), but the Colorado Department of the Treasury must review and approve the request.

Georgia: A Real Assessed-Value Cap Most Guides Miss

Georgia's homestead tax deferral (O.C.G.A. §48-5-70 through §48-5-84) is means-tested by both income and assessed value, a detail worth calling out because it is easy to overlook: you must be 62 or older with gross household income of $15,000 or less, a threshold set in statute rather than adjusted for inflation, and only the portion of your home's assessed value up to $50,000 is actually eligible for deferral. Deferred taxes accrue interest at three-quarters of the state's general tax interest rate, currently 7.3% for 2026 (three-quarters of the 9.75% base rate). Repayment is triggered by a change in use that ends homestead eligibility, a change of ownership (except for a qualifying surviving spouse), letting required insurance lapse, or failing to report other liens within 30 days of a request; separately, if the deferred balance plus interest reaches 85% of the home's fair market value, the tax official is required to notify the owner. A 120-day grace period applies before a triggered amount starts accruing delinquent-style interest. Because the income limit is so low and the assessed-value cap so narrow, most Georgia seniors are better served by the state's senior school-tax exemptions, and administration is entirely local, so confirm with your specific county tax office whether the program is actively processed there.

Deferral vs. Exemption vs. Appeal: Which Should You Use?

These three tools solve different problems, and most homeowners can use more than one at the same time.

Because deferral does not touch your underlying assessed value, it is worth checking whether that value is even correct before you enroll in a deferral program. Deferring an inflated tax bill just means you are borrowing against your home to pay taxes you may not have owed in the first place. An appeal that lowers your assessed value shrinks every future bill, deferred or not, permanently, the same way it would for any other tax year, though it does not by itself change the interest rate or terms of an existing deferral. Exemptions and appeals reduce what you owe. Deferral only delays it, and adds interest on top.

Is a Property Tax Deferral a Good Idea?

Deferral works well for some homeowners and poorly for others. There is no universal right answer, it depends on your plans for the home and your other financial resources.

Deferral tends to make sense when:

• You plan to stay in the home for the rest of your life and do not need to preserve equity for a future sale.
• You need the cash flow now, and the deferral's interest rate is lower than what you would otherwise pay to borrow (a credit card, a personal loan, or delaying necessary home repairs).
• You have already claimed every exemption you qualify for and confirmed your assessment is accurate, so the bill itself is not the problem, only the timing of paying it is.

Deferral tends to backfire when:

• You plan to sell or refinance in the next few years. The deferred balance plus interest is typically due at closing, which can eat into proceeds you were counting on.
• You intend to leave the home to heirs. Deferred taxes and interest become a debt the estate has to settle, often within months, sometimes forcing a sale the heirs did not want.
• Your home has little equity. Programs with an equity requirement (Washington's 80% cap, California's 40% minimum) exist precisely because a heavily mortgaged home may not have enough value to absorb a growing lien.

Talk with an estate planning professional or a trusted family member before enrolling if you plan to pass the home on to heirs. A deferral lien does not disappear when you die, someone has to pay it.

How to Apply for a Property Tax Deferral

Frequently Asked Questions

The Bottom Line

Property tax deferral is a real, legitimate tool for homeowners on fixed incomes who need to free up cash flow now and plan to stay in their home long-term. But it is a loan against your equity, not free money, interest accrues every year, and the balance eventually comes due, typically at the worst possible moment for whoever is settling the estate.

Before you enroll, make sure you have already claimed every exemption you qualify for and confirmed your assessed value is accurate. Deferring an overassessed tax bill just means paying interest on money you may not have owed in the first place.

If you are not sure whether your assessment is accurate, start by entering your address below.