HB 554-FN-A – AS INTRODUCED
2005 SESSION
10/09
HOUSE BILL 554-FN-A
AN ACT establishing a state property tax relief program for seniors and the disabled.
SPONSORS: Rep. Packard, Rock 3; Rep. Dumaine, Rock 3; Rep. Carter, Hills 3; Sen. Bragdon, Dist 11
This bill establishes a state property tax relief program for seniors and the disabled based on income qualifications. Tax relief claims paid by the state shall be reimbursed to the state upon the sale or transfer of the property subject to reimbursement limits.
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Explanation: Matter added to current law appears in bold italics.
Matter removed from current law appears [in brackets and struckthrough.]
Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
05-0418
10/09
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Five
AN ACT establishing a state property tax relief program for seniors and the disabled.
Be it Enacted by the Senate and House of Representatives in General Court convened:
1 New Subdivision; State Property Tax Relief Program for Seniors and the Disabled. Amend RSA 72 by inserting after section 72 the following new subdivision:
State Property Tax Relief Program for Seniors and the Disabled
72:73 State Property Tax Relief Program for Seniors and the Disabled.
I. Each person owning residential property in this state for at least 5 consecutive years as his or her principal place of residence who is either 65 years of age or older, or 60 years of age or older if permanently and totally disabled, and who meets the income qualifications in paragraph II, shall be granted property tax relief as provided in RSA 72:74.
II. For purposes of this subdivision:
(a) “Residence” means the housing unit, and related structures such as an unattached garage or woodshed, which is the person’s principal home, and which the person in good faith regards as home to the exclusion of any other places where the person may temporarily live. “Residence” shall exclude attached dwelling units and unattached structures used or intended for commercial or other nonresidential purposes.
(b) Ownership requirements for a residence shall be that the property is:
(1) Owned by the resident;
(2) Owned by a resident jointly or in common with the resident’s spouse, either of whom meets the age requirement for the exemption;
(3) Owned by a resident jointly or in common with a person not the resident’s spouse, if the resident meets the applicable age requirement for the exemption; or
(4) Owned by a resident, or the resident’s spouse, either of whom meets the age requirement for the exemption, and when they have been married to each other for at least 5 consecutive years.
(c) Annual income qualification for the resulting tax relief shall be:
(1) Less than $30,000 for married persons, or less than $20,000 for an individual, to receive the total property tax cap at 5 percent of the person’s annual income.
(2) Less than $45,000 for married persons, or less than $35,000 for an individual, to receive the total property tax cap at 7 percent of the person’s annual income.
III.(a) Residents shall apply to the department of revenue administration for tax relief of the amount their property taxes exceed the percentage of income identified in subparagraph II(c). Applications shall identify the town or city and the lot or parcel upon which the tax is payable. Complete applications for state tax relief shall be filed with the department of revenue administration between May 1 and June 30.
(b) Each applicant shall provide a copy of his or her federal income tax return for the most recent tax period. Applicants who were not required to file a federal tax return for the immediately prior tax period may submit an affidavit to such effect in lieu of a tax return which document shall include the affiant’s social security number. An applicant who requested an extension to file his or her federal income tax return shall attach a copy of the federal extension to the application. An applicant who asserts ownership in a residence because he or she holds equitable title, or the beneficial interest for life, in the residence shall also submit a copy of the document creating such interest and a copy of the federal tax return, if any, for the immediately prior tax period, of the trust holding legal title to the residence. Any documents submitted shall be considered confidential, and protected under RSA 21-J:14. The provisions of RSA 359-C shall not apply to the documents required to be submitted under this paragraph.
IV. The commissioner of revenue administration shall adopt rules, under RSA 541-A, relative to the application forms, information, instructions, and administration of the tax relief program established in this subdivision.
72:74 Payment of Tax Claim.
I. The department of revenue administration shall review a claim for tax relief filed with it and, if such claim is determined to be valid, shall certify such amount to the state treasurer within 60 days who shall pay such claims by December 31. The governor is authorized to draw a warrant out of any moneys in the treasury not otherwise appropriated for the payment of claims under this subdivision. The department shall notify a claimant whose claim is rejected in whole or in part of such determination within 30 days of the department’s receipt of the claim and all required documentation.
II. The commissioner of the department of revenue administration shall file notice of each tax relief claim paid under this subdivision, within 30 days, with the registry of deeds of the county in which the property is located to perfect it.
72:75 Appeals; Penalties.
I. Any person who files a claim for tax relief under this subdivision with fraudulent intent and any person who assisted in the preparation or filing of the claim or supplied information upon which the claim was prepared shall be guilty of a misdemeanor.
II. Whenever the commissioner refuses to grant a claimant tax relief, or after an audit by the department, assesses an amount against the claimant for property tax relief granted including interest and applicable penalties for an erroneously paid claim, the claimant may appeal in writing within 30 days of notice of such refusal or assessment to the board of tax and land appeals.
III. The board of tax and land appeals may reverse or affirm, in whole or in part, or modify the decision appealed from when there is an error of law or when the board finds the commissioner’s action to be arbitrary or unreasonable.
72:76 Repayment of Tax Relief Granted.
I. When the owner of a property granted tax relief under this subdivision transfers the property to any other person or dies, the accrued amount of the tax relief paid to the collector of taxes for such property shall be repaid from the consideration paid at the transfer of the property, as provided in paragraph II. The commissioner of revenue administration shall have the same rights and remedies in relation thereto as provided in RSA 80.
II. At the sale or transfer of property by an owner who has been granted tax relief under this subdivision, the commissioner of revenue administration shall be reimbursed the total amount of tax relief paid on behalf of the owner for the specific property, except as follows:
(a) The first $100,000 of the sales price or consideration paid for the property shall be exempt from the requirement for reimbursement under this section.
(b) For a sales price or consideration for the property which is over $100,000 but less than $250,000, the required reimbursement shall be total amount of tax relief paid up to $25,000.
(c) For a sales price or consideration for the property which is over $250,000, the required reimbursement shall be total amount of tax relief paid up to $50,000.
III. Moneys collected by the commissioner of revenue administration shall be forwarded to the state treasurer for use as general funds of the state.
2 Interpretation by Commissioner of Revenue Administration. Amend RSA 72:36, I to read as follows:
I. The commissioner’s interpretation of RSA 72:28, RSA 72:29, RSA 72:29-a, RSA 72:30, RSA 72:31, RSA 72:32, RSA 72:33, RSA 72:33-a, RSA 72:34, RSA 72:34-a, RSA 72:35, [and] RSA 72:36-a, and RSA 72:73; and
3 New Paragraph; Commissioner of Revenue. Amend RSA 21-J:3 by inserting after paragraph XXVI the following new paragraph:
XXVII. Administer the state property tax relief program for seniors and the disabled established in RSA 72:73 through RSA 72:76.
4 Effective Date. This act shall take effect April 1, 2005.
LBAO
05-0418
1/28/05
HB 554-FN-A - FISCAL NOTE
AN ACT establishing a state property tax relief program for seniors and the disabled.
FISCAL IMPACT:
The Department of Revenue Administration states this bill will increase state general fund revenue and expenditures by an indeterminable amount in FY 2005 and each year thereafter. There will be no fiscal impact on county and local expenditures or revenue.
METHODOLOGY:
The Department states this bill establishes a state property tax relief program for seniors and the disabled based on income qualifications with the requirement that when a sale or transfer of the property subject to reimbursement occurs, the tax relief claims will be reimbursed to the state. The Department states this will increase state general fund expenditures and revenues by an indeterminable amount. In addition to tax relief, the expenditure increase will include the cost of forms design, software design, postage, informational materials, supplies, storage, and possibly added personnel. Additional administrative costs will include accounting and auditing, and county registry of deeds recording cost.
Currently there are approximately 11,000 taxpayers receiving an elderly exemption. The Department states that many of these taxpayers will not be eligible for the proposed relief because the asset and income limits are lower than their municipality has adopted for the elderly exemption, and many will not apply because this bill actually defers taxes rather than eliminates them. The Department does not have any information on the amount of monies these people pay in taxes after the exemptions and tax credits have been deducted.
The Department is not certain that the revenues received as a repayment of the tax relief will reimburse the State for the tax relief granted. For example, if a residence sells for less than $100,000, the state will receive no reimbursement.