Arizona Property Tax 2026: Limited Property Value, 5% Cap and Senior Freeze

Arizona's property tax system has been reshaped by two major reforms in the last decade: Proposition 117 (effective 2015) capped annual growth in the Limited Property Value at 5%, and the Senior Property Valuation Protection Option lets qualifying seniors freeze their home's LPV for three-year renewable terms. This 2026 guide explains how both work, the 10% Class Three residential assessment ratio, and the September 1 deadline for seniors to lock 2027 values.

How Arizona Property Tax Works

Arizona property tax is administered by the 15 county assessors with uniform state oversight from the Arizona Department of Revenue (ADOR). The tax calculation flows through four distinct values, each set by different rules.

Full Cash Value (FCV)

The assessor's estimate of current market value as of January 1 each year. Updated annually based on sales analysis and mass appraisal techniques.

Limited Property Value (LPV) — the one that matters for tax

LPV is the taxable base. Under Proposition 117 (effective Tax Year 2015), LPV cannot increase more than 5% or the percentage increase in Full Cash Value, whichever is less. This is the figure that millage is applied to.

Assessment Ratio

Different property classes have different assessment ratios applied to LPV:

The tax calculation

Proposition 117 and the 5% LPV Cap

Prior to Proposition 117, Arizona property taxes could rise dramatically in hot housing markets as full cash values tracked market appreciation. Prop 117 decoupled tax growth from market growth.

How the cap works

Each year, the assessor calculates LPV as the lesser of:

• The prior year's LPV plus 5%
• The prior year's LPV plus the percentage increase in Full Cash Value
• Full Cash Value itself (in rare cases of FCV decline)

Over years of rising markets, LPV drifts below FCV. An Arizona home purchased in 2018 might now have FCV of $500,000 but LPV of only $380,000 — the $120,000 gap is tax-protected until a triggering event (new construction, reclassification, sale).

What triggers a reset

• Significant new construction (additions, new structures)
• Property reclassification (e.g., Class Three to Class Four when owner converts to rental)
• Division or merger of parcels

Notably, sale alone does not trigger a reset in Arizona — the LPV cap passes through to the buyer. This is different from California Prop 13 (where sale triggers reassessment).

Senior Property Valuation Protection Option

Arizona offers a county-administered senior freeze separate from the Prop 117 cap. The Senior Property Valuation Protection Option (sometimes called Senior Freeze) fixes a qualifying senior homeowner's LPV for a renewable three-year period.

Eligibility for 2026

• At least one owner must be age 65 or older
• Home must be the primary residence
• Owner must have lived in the home at least 2 years (typically)
• Average household income (all sources, all owners) over the prior 3 years must be:
  • Single owner: $47,712 or less
  • Two or more owners: $59,640 or less

What the freeze does

Locks the LPV at the value as of the application date. For three tax years, the LPV does not rise (unless new construction is added). At the end of the three years, owners must reapply.

What the freeze does NOT do

• Does not freeze the tax rate (voter-approved millage increases still affect bill)
• Does not freeze assessment ratio (reclassification still changes it)
• Does not exempt the owner from tax — LPV still has tax applied at current rates

Application

Submit Form DOR 82104 with your county assessor's office by September 1, 2026 to lock the 2027 values. Renewal is required every three years.

Other Exemptions and Credits

Homestead Exemption (Legal Protection Only)

Arizona's "homestead" exemption under ARS 33-1101 is a protection from general creditors, not a property tax exemption. It does not reduce property tax.

Widow/Widower Exemption

Up to approximately $4,748 of assessed value (2026) for Arizona resident widows and widowers. Income limits apply. File with the county assessor.

Disabled Persons Exemption

Same assessed-value exemption as widow/widower, available to Arizona residents with total and permanent disability. Income limits; proof of disability required.

Disabled Veteran Exemption

Partial exemption for veterans with service-connected disability. Amount scales with VA disability rating. File form DOR 82514 annually.

Property Tax Refund Credit (Arizona Form 140PTC)

A state income tax credit for low-income renters and homeowners. Max credit $502. Eligibility requires:

• Age 65+ or receiving SSI disability
• Household income less than $3,751 (single) or $5,501 (joint household)
• Arizona resident the entire year

File with Arizona state income tax return.

Appealing Your Assessment

Arizona's appeal process begins with an informal review and escalates to formal board review and courts.

Step 1: Review notice of value

Arizona assessors mail Notice of Valuation between February and April each year. Review it immediately.

Step 2: Petition for Review of Valuation

File administrative petition with the County Assessor within 60 days of the notice mailing date. Filing fee typically none; filings are informal. County assessor must respond within 30 days.

Step 3: Appeal to County Board of Equalization

If dissatisfied, appeal to the County Board of Equalization within 30 days of the assessor's response. Hearings are informal; no attorney required for residential.

Step 4: State Board of Equalization or Tax Court

Further appeal within 60 days. Higher-value commercial often goes directly to Tax Court.

Grounds for appeal

• Full Cash Value exceeds current market value (common in cooling markets)
• Property class is incorrect (e.g., Class Three owner-occupied incorrectly coded as Class Four rental)
• Physical attribute errors (square footage, bedroom count)
• Comparable sales demonstrate lower value

Payment Schedule

Arizona property tax is paid in two installments for the fiscal year July 1 to June 30:

• First installment: due October 1, delinquent after November 1 (16% annual interest)
• Second installment: due March 1 of the following year, delinquent after May 1

Delinquent tax accrues 16% annual interest, compounded monthly. After three years of delinquency, the county treasurer may sell the tax lien at public auction. Homeowners have a three-year redemption period during which they can reclaim the lien with payment of tax, interest, and fees.

Frequently Asked Questions

What is Arizona's property tax rate for 2026?

Arizona does not have a statewide property tax rate. Rates are set at the county, city, school district, and special district level. Statewide median effective rate for owner-occupied residential is approximately 0.44 to 0.62 percent of market value, among the lowest in the U.S. See your county's 2026 effective rate on our Arizona state page.

How does Proposition 117 work in Arizona?

Prop 117 (effective Tax Year 2015) caps annual growth in Limited Property Value (LPV) at 5% or the percentage increase in Full Cash Value, whichever is less. LPV is the taxable base. The cap applies automatically to all Arizona property. Sales do not trigger a reset — the LPV cap passes through to buyers.

Who qualifies for the Arizona senior freeze in 2026?

Homeowners age 65+ with at least 2 years of primary residence in the home, and average household income (all owners, 3-year average) at or below $47,712 (single owner) or $59,640 (multiple owners) for 2026. Freezes LPV for a renewable 3-year term. Apply with the county assessor by September 1, 2026 to lock 2027 values.

When is the Arizona property tax appeal deadline?

File a Petition for Review of Valuation with the County Assessor within 60 days of the Notice of Valuation mailing (typically February through April). If dissatisfied, appeal to the County Board of Equalization within 30 days of the assessor's response, then to the State Board of Equalization or Arizona Tax Court.

Does Arizona have a property tax exemption for seniors?

Arizona does not have a dollar-amount homestead exemption for seniors. Relief comes from the Senior Property Valuation Protection Option (freezes LPV for 3 years), the Widow/Widower or Disability exemption (up to $4,748 assessed value off), and the Property Tax Refund Credit (state income tax credit up to $502 for very low-income seniors).