What is a “circuit breaker” tax?

A “circuit breaker” tax is a type of property tax law used in South Dakota. It is a tool used by the state government to limit the amount of property taxes that a homeowner must pay. The circuit breaker works by capping the total property taxes that a homeowner must pay on their primary dwelling. This cap is based on the estimated market value of the property or the adjusted gross income of the homeowner, whichever is lower. For example, in South Dakota, if the market value of the property is $50,000 and the homeowner’s adjusted gross income is $30,000, then their property taxes would be capped at $30,000. This means that even if the taxes on the property are higher than $30,000, the homeowner would only be responsible for paying the $30,000 cap. This makes property taxes more affordable for South Dakota homeowners. The circuit breaker property tax law is beneficial for South Dakota homeowners who may not have the financial means to pay their property taxes in full. It helps to ensure that South Dakota residents are not overburdened with property taxes and that they can continue to live in their homes.

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What is a “circuit breaker” tax?

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