Revision: Jan. 15, 2009, midnight
2009 SESSION
10/01
HOUSE BILL 351
AN ACT relative to the interest rate on late and delinquent property tax payments and subsequent payments.
SPONSORS: Rep. Kepner, Rock 15; Rep. Henson, Rock 13; Rep. T. Russell, Rock 13
COMMITTEE: Local and Regulated Revenues
This bill establishes a procedure for the determination of interest rates chargeable by towns and cities for late tax payments and for redemptions and subsequent tax payments, including a reduced interest rate for persons with a financial hardship.
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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Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
09-0176
10/01
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Nine
AN ACT relative to the interest rate on late and delinquent property tax payments and subsequent payments.
Be it Enacted by the Senate and House of Representatives in General Court convened:
1 New Section; Collection of Taxes; Interest Rate; Hardship Exception. Amend RSA 80 by inserting after section 17 the following new section:
80:17-a Interest Rates; Hardship Exception. The following shall apply to the charging of interest on the collection of taxes:
I. The base rate for interest charged on the late payment of taxes under RSA 76:13 shall be the prime rate plus 2 points.
II. The base rate for interest charged on payments made in redemption of property under RSA 80:32 or RSA 80:69, or on the payment of subsequent taxes by a person making a redemption under RSA 80:37 or RSA 80:75, III shall be the prime rate plus 4 points.
III. The rates charged under paragraphs I or II shall apply to payments made during the first 90 days after the due date for the payment of taxes or subsequent taxes or the date of the creation of the legal interest in the land for redemptions. After 90 days, in addition to the interest charged under paragraphs I or II, a penalty shall be assessed and collected at the following percentages:
(a) For payments made after 90 days and up to 180 days, one percent of the tax or redemption amount added to the payment due.
(b) For payments made after 180 days and up to 270 days, 2 percent of the tax or redemption amount added to the payment due.
(c) For payments made after 270 days and up to 360 days, 3 percent of the tax or redemption amount added to the payment due.
(d) For payments made after 360 days, 4 percent of the tax or redemption amount added to the payment due.
IV. Notwithstanding paragraphs I-III, a person with a financial hardship may apply and, if qualified, shall be assessed a rate of interest calculated as the prime rate minus 2 points on all late tax payments, payments made in redemption of property, or payments of subsequent taxes, as follows:
(a) To qualify, an applicant seeking a hardship exception shall meet both of the following tests:
(1) A net worth test, determined as the amounts due and unpaid divided by a homeowner’s excess assets over liabilities, but excluding the assessed value of his or her principal place of residence, which must be greater than 15 percent.
(2) An income test, determined as the amounts due and unpaid divided by the homeowner’s after-tax income, joint if the home is jointly owned, which must be greater than 15 percent.
(b) The assessing officials may request true copies of any documents as needed to verify eligibility. Unless otherwise provided for by law, all documents submitted with an application or as requested, as provided for in subparagraph (a), and any copies shall be considered confidential, handled so as to protect the privacy of the individual, and not used for any purpose other than the specific statutory purposes for which the information was originally obtained. All documents and copies of such documents submitted by the applicant shall be returned to the applicant after a decision is made on the application.
V. The prime rate of interest shall be determined by the state treasurer as the applicable bank prime lending rate for the property tax year beginning the first day of April in each year rounded to the nearest tenth of a percentage point. On or immediately before April 1 in each year, the state treasurer shall determine the rate and transmit it to the each town and city tax collector in this state. As established, the rate shall be in effect beginning the first day of April through the last day of March in the following year.
2 Property Taxes; Interest on Late Payment. Amend RSA 76:13 to read as follows:
76:13 Interest. Interest at [12 percent per annum] the applicable rate under RSA 80:17-a shall be charged upon all taxes except resident taxes, except as otherwise provided by statute, not paid on or before December 1 after their assessment, which shall be collected from that date with the taxes as incident thereto, except in the case where a tax bill sent to the taxpayer on or after November 2 and before April 1 of the following year interest shall not be charged until 30 days after the bills are mailed. Interest due in an amount up to $25 may be waived by the collector, with the approval and consent of the board of selectmen and the board of assessors, if in the collector’s judgment the administrative and collection costs involved do not warrant collection of the amount due. The tax collector shall state on the tax bill the date from which interest will be charged and such date shall be determined by the day the collector sends out the last tax bill on the list. The collector shall notify the board of tax and land appeals in writing of the date on which the last tax bill was sent.
3 Collection of Taxes; Interest Rate. Amend RSA 80:32 to read as follows:
80:32 Redemption. Any person with a legal interest in land so sold may redeem the same by paying or tendering to the collector, or in his or her absence, at his or her usual place of abode, at any time before a deed thereof is given by the collector, the amount for which the land was sold, with interest at [18 percent per annum] the applicable rate under RSA 80:17-a upon the whole amount for which the land was sold from the time of sale to the time of payment in full, except that in the case of partial payments in redemption made under RSA 80:33-a, the interest shall be computed on the unpaid balance, together with redemption costs and costs for notifying the mortgagees, if any. In case the tax collector who sold the property in question shall have died, become incapacitated, been removed from office or removed from the town or city or shall have been discharged from his or her bond by the selectmen or assessors, then the person with the legal interest in redeeming the property may tender such sums to the tax collector then in office of said city or town. Upon advice from the selectmen or assessors that the amount tendered is the correct amount due, the tax collector shall accept said amount for the redemption of the property.
4 Collection of Taxes; Interest Rate. Amend RSA 80:37 to read as follows:
80:37 Payment of Subsequent Tax. For purposes of this section, “subsequent tax” shall mean any tax assessed upon the real estate subsequent to that for which it was sold by a municipality, a county or the state. The purchaser of real estate at any tax sale may pay to the collector any subsequent tax and the collector shall, within 30 days after such payment, notify the register of deeds thereof, giving the date and the amount of such payment and the name of the person so paying together with the date of the tax sale, the name of the person taxed and a description of the property sold as shown in the report of sale recorded in the registry of deeds. The collector of taxes shall receive $1 for such notice to the register of deeds of the payment of subsequent tax plus $1 to be paid to the register of deeds. The purchaser, within 30 days of payment of the subsequent tax, shall personally, or by certified mail, notify in writing any mortgagee who was notified of his or her purchase at the tax sale of this payment of the subsequent tax. The purchaser paying the subsequent tax shall receive the same fees prescribed for notifying the mortgagee of his or her purchase at the tax sale to be included in his or her costs to be paid by the person making redemption, except that when a town is a purchaser at a tax sale and the town pays a subsequent tax and the selectmen direct the collector of taxes as agent for the town to give notice of payment of a subsequent tax to any mortgagee who was notified of the purchase by the town at the tax sale, the collector shall be paid the sum of $5 for this service. Any amounts so paid on account of subsequent taxes, together with interest thereon at the applicable rate [of 18 percent per annum] under RSA 80:17-a from the date of payment shall, in addition to the purchase price at the time of sale with accrued interest and costs, be paid by the person making redemption.
5 Collection of Taxes; Interest Rate. Amend RSA 80:69 to read as follows:
80:69 Redemption. Any person with a legal interest in land subject to a real estate tax lien may redeem the same by paying or tendering to the collector, at any time before a deed thereof is given by the collector, the amount of the real estate lien, with interest at [18 percent per annum] the applicable rate under RSA 80:17-a upon the whole amount of the recorded lien from the date of execution to the time of payment in full, except that in the case of partial payments in redemption made under RSA 80:71, the interest shall be computed on the unpaid balance, together with redemption costs and costs for identifying and notifying the mortgagees, if any. In case the tax collector who executed the tax lien against the property in question shall have died, become incapacitated, been removed from office or removed from the town or city or shall have been discharged from his or her bond by the selectmen or assessors, then the person with the legal interest in redeeming the property may tender such sums to the tax collector then in office of said city or town. Upon advice from the selectmen or assessors that the amount tendered is the correct amount due, the tax collector shall accept said amount for the redemption of the property.
6 Collection of Taxes; Interest Rate. Amend RSA 80:75, III to read as follows:
III. When a municipality is the lienholder and the municipality pays a subsequent tax and the selectmen direct the collector of taxes, as agent of the municipality, to give such notice of said payment to any owner and to any mortgagee as provided above, the collector of taxes shall receive the same fees provided for the lienholder for his or her service. The amount of subsequent taxes paid, together with interest on such taxes at the applicable rate [of 18 percent per annum] under RSA 80:17-a from the date of payment shall, in addition to the tax lien amount at the time of execution with interest and costs, be paid by the person making redemption.
7 Effective Date. This act shall take effect April 1, 2009.