HB746: revising the property tax relief program.

HB 746-FN-A - AS AMENDED BY THE HOUSE

12mar03... 0538h

2003 SESSION

03-0324

09/01

HOUSE BILL 746-FN-A

AN ACT revising the property tax relief program.

SPONSORS: Rep. Hess, Merr 37; Rep. Alger, Graf 14; Rep. J. Gilbert, Rock 83; Rep. Kurk, Hills 48; Sen. O'Hearn, Dist 12

COMMITTEE: Ways and Means

AMENDED ANALYSIS

This bill revises the current "low and moderate income homeowners property tax relief" program as the "state education property tax homeowners relief" program. This relief program will be available to any resident homeowner whose total net property taxes exceed 10 percent of household income or 8 percent of household income if such resident homeowner filed a federal income tax return as head of household. This bill allows a rebate from education property taxes paid in the amount of the difference between total net property tax paid and 8 percent or 10 percent of household income depending on federal income tax filing status, or $1,500, whichever is less.

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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Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.

12mar03... 0538h

03-0324

09/01

STATE OF NEW HAMPSHIRE

In the Year of Our Lord Two Thousand Three

AN ACT revising the property tax relief program.

Be it Enacted by the Senate and House of Representatives in General Court convened:

1 Subdivision Heading Amended. The subdivision heading preceding RSA 198:56 is repealed and reenacted to read as follows:

State Education Property Tax Homeowners Relief

2 Definitions; Household Income; Tax Relief. Amend RSA 198:56, III and IV to read as follows:

III. (a) "Household income" means the sum of [the adjusted gross income for federal income tax purposes] net income from all sources of the claimant and any adult member of the claimant's household who resides in the homestead for which a claim is made. The net income shall be determined by deducting from all moneys received from any source, including social security and pension payments, the amount of any of the following or the sum thereof:

(1) Life insurance paid on the death of an insured;

(2) Expenses and costs incurred in the course of conducting a business enterprise; and

(3) Proceeds from the sale of assets.

(b) "Household income" shall also include all income of any trust through which the claimant holds equitable title, or the beneficial interest for life, in the homestead.

IV. "Tax relief" means the [low and moderate income homeowners] state education property tax homeowners relief provided in this subdivision.

3 New Paragraph; Definition; Net Property Tax. Amend RSA 198:56 by inserting after paragraph VI the following new paragraph:

VII. "Net property tax" means all state and local property taxes owed after all applicable exemptions and credits.

4 Section Heading Amended. The section heading of RSA 198:57 is repealed and reenacted to read as follows:

198:57 State Education Property Tax Homeowners Relief.

5 Eligibility. Amend RSA 198:57, III to read as follows:

III. An eligible tax relief claimant is a person who:

(a) Owns a homestead or interest in a homestead subject to the education property tax;

(b) Resided in such homestead on April 1 of the year for which the claim is made, except such persons as are on active duty in the United States armed forces or are temporarily away from such homestead but maintain the homestead as a primary domicile; and

(c) [Realizes total household income of:

(1) $20,000 or less if a single person;

(2) $40,000 or less if a married person or head of a New Hampshire household] Paid net property tax in excess of 8 percent of household income if such person filed a federal income tax return as head of household or 10 percent of household income if such person did not file as head of household.

6 Calculation of Rebate. RSA 198:57, IV is repealed and reenacted to read as follows:

IV.(a) All or a portion of an eligible tax relief claimant's state education property taxes, RSA 76:3 shall be rebated in the lesser of the following:

(1) The amount equal to the difference between 8 percent of household income and net property tax paid for persons who filed a federal income tax return as head of household or the difference between 10 percent of household income and net property tax paid for persons who did not file as head of household; or

(2) $1,500.

(b) The amount determined by subparagraph (a) is the allowable tax relief in any year.

7 Reference Change; Public Contractors Added. Amend RSA 21-I:18, I(l) to read as follows:

(l) Purchases of services from private and public contractors by the department of revenue administration with respect to the administration of [low and moderate income homeowners] state education property tax homeowners relief claims.

8 Effective Date. This act shall take effect July 1, 2003.

LBAO

03-0324

Revised 3/4/03

HB 746 FISCAL NOTE

AN ACT revising the property tax relief program.

FISCAL IMPACT:

The Department of Revenue Administration indicates this bill will have an indeterminable fiscal impact on state education trust fund expenditures in FY 2004 and each year thereafter. There will be no fiscal impact on state, county and local revenue or county and local expenditures.

METHODOLOGY:

The Department states the fiscal impact of this bill cannot be determined because terms used in this bill, such as household income, are not defined or are defined in a way so as to differ from existing federal, state or other data sources.