Nearly 23,000 property owners are wrongfully claiming homestead exemptions in Philadelphia, costing the city and its school district $11.4 million annually in lost tax revenue, according to an investigation released Monday by City Controller Christy Brady.
The homestead exemption program reduces a property's taxable assessed value by $100,000 for qualifying homeowners who use the property as their primary residence. This saves eligible homeowners approximately $1,400 annually on their real estate taxes.
Brady's office identified widespread abuse through data mining and cross-checking …
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Nearly 23,000 property owners are wrongfully claiming homestead exemptions in Philadelphia, costing the city and its school district $11.4 million annually in lost tax revenue, according to an investigation released Monday by City Controller Christy Brady.
The homestead exemption program reduces a property's taxable assessed value by $100,000 for qualifying homeowners who use the property as their primary residence. This saves eligible homeowners approximately $1,400 annually on their real estate taxes.
Brady's office identified widespread abuse through data mining and cross-checking property records. The investigation found businesses owning multiple properties, owners claiming exemptions on multiple properties, and individuals with mailing addresses outside Philadelphia — some as far as California — improperly receiving the tax break.
"We believe these individuals are committing real estate tax fraud," Brady said. "The city and School District of Philadelphia stand to lose $57 million over the next five years if this issue is not properly addressed."
The highest concentration of illegitimate exemptions was found in South Philadelphia and Lower Northeast neighborhoods, according to the controller's mapping analysis.
Brady's office recommended strengthening verification processes for property ownership, implementing cross-checks of mailing addresses, reviewing out-of-city property owners' eligibility, and establishing penalties for improper exemptions.
The investigation began after a Philadelphia resident approached the controller's office with concerns about homeowners filing multiple exemptions. The resident's research provided a foundation for the broader investigation.
Council President Kenyatta Johnson previously raised concerns about homestead exemption abuse during last year's budget discussions. The controller's findings have been shared with the Office of Property Assessment and the Department of Revenue for further action.
For 2025 real estate taxes, eligible homeowners can receive the $100,000 reduction in assessed value through the program when properly qualified.
