If you own a home in metro Atlanta, you may have heard that Georgia now caps how fast your property's taxable value can rise. That's the promise of HB 581, the 'Save Our Homes' floating homestead exemption. But for the 2026 tax year, the cap probably isn't doing what you think it is — because the county, city, or school district that taxes your home very likely opted out.
This matters beyond your tax bill. If you have a mortgage with an escrow account, an uncapped 2026 reassessment can flow straight into your monthly payment. And the broad relief many homeowners are expecting doesn't actually arrive statewide until 2027, under a separate law — SB 33, the HOME Act. Here's how the pieces fit together.
What HB 581 actually is
HB 581 — the 'Save Our Homes Act,' sometimes called the 'Save the Homes Act' — took effect January 1, 2025, after Georgia voters ratified the enabling constitutional amendment in November 2024. It created a statewide floating homestead exemption that caps annual growth in a qualifying homestead's taxable value at the inflationary (CPI) index rate, rather than letting taxable value track a hot market straight up.
The mechanism is worth understanding precisely: it doesn't freeze your assessment, and it doesn't cap your tax rate. It limits how much the taxable value of an owner-occupied homestead can grow each year to the annual inflationary index. The Georgia Department of Revenue publishes that index rate and explains how it's applied to taxable value. The exemption applies only to qualifying homesteads — the home you actually live in.
The opt-out window most metro jurisdictions used
Here's the catch that trips up a lot of homeowners. HB 581 let local taxing jurisdictions — counties, cities, and school districts — opt out of the exemption for tax years 2026 through 2029. The initial opt-out deadline was March 1, 2025, and a jurisdiction has to renew its opt-out annually to stay out.
A lot of them opted out. According to the Tax Foundation's analysis, about 64.8% of Georgia counties — representing nearly 83% of the state's population — had their school system, their general government, or both opt out. In all, the Tax Foundation counted 316 local government entities opting out, including 47 counties (roughly 30% of all counties). Because the opt-outs are concentrated in the populous jurisdictions, far more people live under an opt-out than the county count alone suggests.
Metro county-by-county reality check
In metro Atlanta and Chatham (Savannah), the opt-outs hit exactly where the most homeowners are:
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School systems: All five of the largest counties — Fulton, Gwinnett, Cobb, DeKalb, and Chatham — had their school systems opt out. School taxes are typically the biggest slice of a Georgia property tax bill, so this alone removes the cap from a large share of what you pay.
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County governments: The general county governments of Gwinnett and Cobb also opted out.
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The Fulton exception: Fulton County's Board of Commissioners actually opted in. So the common shorthand that 'Fulton opted out' is inaccurate at the county-government level. Fulton keeps its own roughly 20-year local floating homestead exemption, and its assessors apply whichever exemption — the local one or HB 581 — gives each homeowner the larger break. Note, though, that within Fulton the City of Atlanta and the Atlanta school system opted out, so the picture there is layered depending on which line item you're looking at.
The practical takeaway: in most metro jurisdictions, the HB 581 CPI cap is not limiting your 2026 taxable value on the largest parts of your bill. In Fulton, some county-level protection remains, but it varies by taxing authority.
Who is actually protected in 2026
For 2026, the HB 581 cap mainly protects homesteads in jurisdictions that opted in — which are largely rural counties. If you live in an opted-in county, a rising 2026 assessment is buffered: your taxable value growth is limited to the inflationary index.
If you live in an opted-out jurisdiction (which describes most metro homeowners for the largest parts of their bill), there's no CPI buffer. A higher 2026 assessment flows through to a higher taxable value and a higher tax bill. To know which bucket you're in, you have to check the opt-out status of each authority that taxes your home — county government, city, and school district can each be different.
The escrow connection: how this reaches your mortgage payment
For most mortgaged homeowners, property taxes aren't paid in one lump sum — they're collected monthly through an escrow account and paid by the servicer when due. That's the link between an uncapped reassessment and your monthly payment.
When your annual tax bill rises, your servicer raises the monthly escrow portion of your payment to collect enough over the year. Worse, if the higher bill hits before the servicer has adjusted, it can create an escrow shortage — and you may face a catch-up: a temporary bump to make up the gap on top of the new, higher ongoing amount. So an uncapped 2026 reassessment in an opted-out jurisdiction can directly raise your monthly mortgage payment, not just your once-a-year tax bill. If you're budgeting for 2026, this is the line to watch.
SB 33 — the HOME Act — and what changes in 2027
The relief many homeowners assume they already have arrives statewide under SB 33, the Homeownership Opportunity and Market Equalization (HOME) Act of 2026. Gov. Brian Kemp signed it on May 11, 2026, and it takes effect for the 2027 tax year. Here's what it does:
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Mandatory cap, no more opt-outs. SB 33 makes the floating homestead cap mandatory statewide. Cities, counties, and school districts can no longer opt out — eliminating the opt-outs that had covered roughly 83% of the population. Starting in 2027, the CPI cap applies whether your local jurisdiction likes it or not.
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A revenue limit — but not a hard 3% cap. This is widely misunderstood. Beginning in 2027, local governments and school districts must get voter approval before adopting budgets projected to push property-tax revenue above the greater of 3% or inflation, with limited exceptions for new growth and declared emergencies. It's a voter-approval trigger, not an absolute ceiling.
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LHOST. SB 33 also authorizes a Local Homestead Option Sales Tax — a 1% local sales/use tax that jurisdictions can levy to fund property-tax reductions.
Fine print and risks
A few limits are important to keep expectations grounded:
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What's not covered. Neither the homestead cap nor SB 33's protections apply to rental properties, commercial buildings, second homes, or vacant land. Those continue to track full market value. This is a homestead — owner-occupied — benefit.
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A possible constitutional challenge. Critics argue that because SB 33 raises or reallocates revenue but originated in the Senate, it may run afoul of the Georgia Constitution's origination clause, which requires revenue bills to start in the House. It's a live question, and reporting around the signing flagged both that concern and worries from local governments about their revenue.
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Opt-out history. Earlier, HB 92 (2025) let jurisdictions that had opted out for tax year 2025 rescind that opt-out by April 30, 2025. Analysts expected few to reverse course, given how involved local-government associations were in the opt-out push.
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Separate income-tax action. As part of the same May 2026 signing, HB 463 lowers Georgia's income tax rate from 5.19% to 4.99% beginning January 1, 2026. That's distinct from property tax, but it's part of the same tax package.
What to do before 2027
Because 2026 is largely an uncapped year in metro Georgia and the statewide cap doesn't kick in until 2027, this is a good window to get your affairs in order:
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Check your jurisdiction's opt-out status. Confirm whether your county government, city, and school district opted out for 2026 — each can be different.
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Watch your 2026 assessment notice and appeal deadline. In an opted-out jurisdiction, the assessed value is what drives your bill. If the assessment looks off, note the appeal window on the notice and act within it.
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Budget for a possible escrow increase. If your 2026 bill rises, expect your servicer to raise the escrow portion of your monthly payment — and possibly a shortage catch-up. Set aside a cushion.
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Verify your homestead exemption is on file. The floating cap only helps qualifying homesteads. Make sure your exemption is properly recorded with your county.
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Confirm your 2027 eligibility. When SB 33's mandatory cap takes effect, you'll want your homestead status squared away so you get the benefit from day one.
The bottom line: for 2026, don't assume you're capped. In most of metro Atlanta and Chatham, the largest parts of your bill are unprotected this year because of local opt-outs, and that can show up in your monthly mortgage escrow. The broad, mandatory protection is real — but it's a 2027 story, and even then it comes with exclusions and an unresolved legal question.
Related reading
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The Quiet 2026 Tax Change Letting Some Georgia Veterans Write Off the VA Funding Fee
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[Trump's $200 Billion Bond Buy and a Stalled Fannie-Freddie IPO: The Washington Fight That Actually Sets Your Georgia Mortgage Rate](/article/trump-bond-buy-fannie-freddie-ipo-georgia-mortgage-rates)
Sources
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Localities Opt Out of Georgia's New Homestead Tax Exemption — Tax Foundation
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[Georgia Property Tax Cap 2026: SB 33 Explained — AppealAlly](https://appealally.com/blog/article/georgia-property-tax-cap-sb-33)
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Gov. Kemp Signs Legislation Lowering Taxes and Supporting Economic Growth — Office of the Governor
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Georgia governor signs income, property tax reduction laws — WABE
