(a) Upon proper application to the Tax Assessor, an owner of homestead residential real property or unimproved property is entitled to a credit, not to exceed $5,000, equal to the amount by which the real property taxes calculated for the property for the prior year exceed two percent of gross household income, if:
(1) The homeowner has been granted a homestead exemption for at least three out of the prior five tax years; or ownership of the unimproved property has been acquired by a Class I inheritance as defined in chapter 1, section 1 of this title;
(2) Gross household income for a single property owner does not exceed $75,000, and gross household income for married property owners do not exceed $150,000;
(3) The homeowner is current on all real property tax obligations, or current on an existing payment plan for outstanding property taxes; and
(4) The homeowner has filed with the Office of the Tax Assessor an affidavit of gross income.
(b) The credit applies only for the current tax year as of January 1, with no carryover credit allowed.
(c) The amount of this circuit breaker tax is based on the gross building assessed value, or the gross land assessed value, and is phased out using the following schedule:
| Assessed Value of Real Property | Eligible Percentage of Circuit Breaker |
| Up to $400,000 | 90% |
| $400,001 to $450,000 | 80% |
| $450,001 to $500,000 | 70% |
| $501,000 to $600,000 | 60% |
| $601,000 to $750,000 | 50% |
(d) As used in this section, the following meanings apply:
(A) “Gross household income” means all income from whatever source derived, including but not limited to, business income, salary, wages, tips, capital gains, dividends, interest, rents, pensions and alimony.
(B) “Homestead” means a homeowner’s principal residence, which is the place of the owner’s true, fixed, and permanent home to which, whenever absent, the owner intends to return and continues as a principal residence until another principal residence is established. A homeowner shall have only one homestead at a time.