What is the homestead exemption in Arizona and how do I claim it?

Arizona dramatically increased its homestead to $400,000 via Proposition 209 in 2022.

1. Two Concepts

Arizona's residential property is taxed at a favorable 10% assessment ratio under A.R.S. § 42-12003. The creditor/bankruptcy homestead under A.R.S. § 33-1101 separately protects equity from forced sale.

2. Creditor / Bankruptcy Homestead

A.R.S. § 33-1101 (as amended by Prop 209, eff. December 2022) protects $400,000 of equity in a primary residence — up from $250,000. The amount is indexed annually for inflation beginning 2024.

3. Automatic vs Declaration

The exemption auto-attaches without recording. Only one homestead per household.

4. Federal Bankruptcy Cap

Arizona opted out of federal exemptions (A.R.S. § 33-1133). BAPCPA § 522(p)'s $189,050 cap can apply for property acquired within 1,215 days, reducing the available homestead in those cases.

5. Property-Tax Homestead

Arizona does not provide a flat property-tax homestead exemption. Instead, Class 3 (owner-occupied residential) is assessed at 10% of full cash value, versus 18% for commercial. The Senior Property Valuation Protection (Senior Freeze) under A.R.S. § 42-13301 freezes the limited value for qualifying seniors 65+ with income limits.

6. Filing Property-Tax Exemption

File the Senior Freeze application with the county assessor between January 1 and September 1.

7. Spousal Protections

Community property protects marital homes from one spouse's separate debts. Both spouses must sign to convey or mortgage.

8. Loss Triggers

Abandonment, conveyance, or election of homestead in another state defeats the exemption. Sale proceeds protected for 18 months under § 33-1101(C) — among the most generous in the country.

9. Foreclosure & Forced Sale Exceptions

Purchase-money mortgages, deeds of trust, mechanic's liens for improvements, tax liens, child support, and federal liens override the exemption.

This is legal information, not legal advice.