HB 1734-FN-A-LOCAL – AS INTRODUCED
2006 SESSION
09/10
HOUSE BILL 1734-FN-A-LOCAL
AN ACT establishing a homestead exemption for seniors against the statewide enhanced education tax and a tax cap credit for seniors against local and state property taxes.
SPONSORS: Rep. Espiefs, Ches 3
COMMITTEE: Municipal and County Government
This bill establishes a homestead exemption for persons 65 years of age and older against the statewide enhanced education tax and a tax cap credit for persons 65 years of age and older against local and state property taxes.
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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Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
06-2989
09/10
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Six
AN ACT establishing a homestead exemption for seniors against the statewide enhanced education tax and a tax cap credit for seniors against local and state property taxes.
Be it Enacted by the Senate and House of Representatives in General Court convened:
1 New Sections; Homestead Exemption; Tax Cap Credit. Amend RSA 76 by inserting after section 3 the following new sections:
76:3-a Homestead Exemption for Persons 65 Years of Age or Older.
I. Each person owning residential property in this state for at least 10 years as his or her principal place of residence and who is 65 years of age or older, shall be granted an exemption against the statewide enhanced education tax assessed under RSA 76:3 on the assessed value of the person’s residence in the amount of $100,000 or in the amount of the assessed value of the person’s residence, whichever is less. Only one exemption may be granted for each homestead.
II. For purposes of this section:
(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 homestead exemption 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.
III. Procedures for application, investigation of applications, and appeals shall be as provided in RSA 72:33, RSA 72:34, and RSA 72:34-a.
76:3-b Tax Cap Credit for Persons 65 Years of Age or Older.
I. An owner of a single-family residence who is 65 years of age or older and who has continually resided at that same residence for at least 10 years shall be granted a credit against total state and local property taxes owed for the amount of increase in total state and local property taxes which is greater than 5 percent of the total state and local property taxes owed by such owner in the prior tax year.
II. Residence and ownership requirements shall be the same as are required for the homestead exemption under RSA 76:3-a.
III. Procedures for application, investigation of applications, and appeals shall be as provided in RSA 72:33, RSA 72:34, and RSA 72:34-a.
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, RSA 76:3-a and RSA 76:3-b; and
3 Effective Date. This act shall take effect April 1, 2006.
LBAO
06-2989
Revised 12/19/05
HB 1734 FISCAL NOTE
AN ACT establishing a homestead exemption for seniors against the statewide enhanced education tax and a tax cap credit for seniors against local and state property taxes.
FISCAL IMPACT:
The Department of Revenue Administration and New Hampshire Municipal Association state this bill will decrease state restricted education trust fund revenue and increase local expenditures by an indeterminable amount in FY 2006 and each year thereafter. There will be no fiscal impact on state and county expenditure or county and local revenue.
METHODOLOGY:
The Department of Revenue Administration states this bill establishes a homestead exemption for persons 65 years of age and older against the statewide enhanced education tax and a tax cap credit for persons 65 years of age and older against local and state property taxes. The Department indicates that state restricted education trust fund revenue will decrease, but the amount is indeterminable. The Department states that New Hampshire has 101,849 households with a person 65 years of age or older according to the 2000 US Census, however, the Department cannot determine the value of homes and the various tax rates for these households or determine those over 65 that have lived in the state for at least 10 years. The Department further indicates that in 2002, 3,798 of the 11,215 households which claimed an elderly exemption were in the 65-74 age category. The assessed value of these households was reduced by a total of $587,408,732 resulting in a tax shift of approximately $14,119,392. The 11,215 households had to meet net income level criteria to be granted an exemption and the exemption was for a limited amount. However, it appears that these households will still receive this exemption and then be granted an exemption from property taxes designated for state education and local education. Since there are no income threshold limitations in this bill, every owner of a primary residence who is over 65 years old and has lived in this state for at least 10 years will receive this exemption. The number of people eligible for this exemption could be much larger than those currently allowed the elderly exemption as evidenced by the 2000 US Census figures showing 101,849 people age 65 and over in households. The Department states that this tax change can be administered within their existing budget.
The New Hampshire Municipal Association (NHMA) indicates this bill will not change local revenue from property tax, but will redistribute the tax burden among local taxpayers that do not qualify for the exemption and credit stated in this bill. NHMA indicates that the processing and investigation of applications for the exemption and credit would impose additional administrative costs on municipalities. NHMA states that it is not possible to determine the amount of these costs.