Bill S6645-2013

Allows for increases in the amount of income property owners may earn for purposes of qualification for certain tax exemptions

Allows for increases in the amount of income property owners may earn for purposes of qualification for certain tax exemptions.

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  • Feb 21, 2014: REFERRED TO AGING

Memo

BILL NUMBER:S6645

TITLE OF BILL: An act to amend the real property tax law, in relation to allowing for increases in the amount of income property owners may earn for purposes of qualification for certain tax exemptions

PURPOSE OR GENERAL IDEA OF BILL:

The bill increases the maximum income eligibility limit for the Senior Citizen Homeowner Exemption (SCHE) from $29,000 to $32,000 starting July 1, 2014. Future increases to the income eligibility limit will automatically take effect every two years starting July 1, 2016, by the average annual percentage change in the U.S. Department of Labor's Consumer Price Index for all urban consumers (CPI-U).

SUMMARY OF SPECIFIC PROVISIONS:

Section 1 amends paragraph a of subdivision 3 of section 467 of the real property tax law to increase the maximum income eligibility limit for the Senior Citizen Homeowner. Exemption and establish automatic biennial increases to the maximum income eligibility limit.

Section 2 states that the bill will take effect immediately.

JUSTIFICATION:

Section 467 of the Real Property Tax Law authorizes local governments to provide a partial property tax exemption to senior citizens. The exemptions are based on income, and provided on a sliding scale from 5%-50% exemption. The current maximum income for the 50% exemption is $29,000, and was last increased in 2009.

According to the U.S. Department of Labor, $29,000 in 2009 dollars equals $31,600 in 2014 dollars, due to inflation. Many seniors who previously qualified for the SCHE exemption may no longer qualify due to cost-of-living adjustments to their fixed sources of income. This bill would raise the maximum income to $32,000 starting on July 1, 2014, and tie future increases of the eligibility limit to the Consumer Price Index. Doing so will ensure that seniors aren't "priced out" of the exemption due to nominal increases in their fixed incomes, and remove the need for the state legislature to revisit the income eligibility every few years.

PRIOR LEGISLATIVE HISTORY:

New Bill.

FISCAL IMPLICATIONS:

None to the state.

EFFECTIVE DATE:

This act shall take effect immediately.


Text

STATE OF NEW YORK ________________________________________________________________________ 6645 IN SENATE February 21, 2014 ___________
Introduced by Sen. HOYLMAN -- read twice and ordered printed, and when printed to be committed to the Committee on Aging AN ACT to amend the real property tax law, in relation to allowing for increases in the amount of income property owners may earn for purposes of qualification for certain tax exemptions THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. Paragraph (a) of subdivision 3 of section 467 of the real property tax law, as amended by chapter 259 of the laws of 2009, is amended to read as follows: (a) if the income of the owner or the combined income of the owners of the property for the income tax year immediately preceding the date of making application for exemption exceeds the sum of three thousand dollars, or such other sum not less than three thousand dollars [nor more than twenty-six thousand dollars beginning July first, two thousand six, twenty-seven thousand dollars beginning July first, two thousand seven, twenty-eight thousand dollars beginning July first, two thousand eight, and twenty-nine], THIRTY-TWO thousand dollars beginning July first, two thousand [nine] FOURTEEN, as may be provided by the local law, ordinance or resolution adopted pursuant to this section; PROVIDED, HOWEVER, BEGINNING JULY FIRST, TWO THOUSAND SIXTEEN AND EVERY TWO YEARS THEREAFTER, THE MAXIMUM ALLOWABLE INCOME SHALL INCREASE BY THE PRODUCT OF THE AVERAGE ANNUAL PERCENTAGE CHANGES IN THE CONSUMER PRICE INDEX FOR ALL URBAN CONSUMERS (CPI-U) AS PUBLISHED BY THE UNITED STATES DEPARTMENT OF LABOR BUREAU OF LABOR STATISTICS FOR THE TWO YEAR PERIOD ROUNDED TO THE NEAREST ONE THOUSAND DOLLARS. Income tax year shall mean the twelve month period for which the owner or owners filed a federal personal income tax return, or if no such return is filed, the calendar year. Where title is vested in either the husband or the wife, their combined income may not exceed such sum, except where the husband or wife, or ex-husband or ex-wife is absent from the property as provided in subpar- agraph (ii) of paragraph (d) of this subdivision, then only the income of the spouse or ex-spouse residing on the property shall be considered and may not exceed such sum. Such income shall include social security
and retirement benefits, interest, dividends, total gain from the sale or exchange of a capital asset which may be offset by a loss from the sale or exchange of a capital asset in the same income tax year, net rental income, salary or earnings, and net income from self-employment, but shall not include a return of capital, gifts, inheritances, payments made to individuals because of their status as victims of Nazi perse- cution, as defined in P.L. 103-286 or monies earned through employment in the federal foster grandparent program and any such income shall be offset by all medical and prescription drug expenses actually paid which were not reimbursed or paid for by insurance, if the governing board of a municipality, after a public hearing, adopts a local law, ordinance or resolution providing therefor. Furthermore, such income shall not include the proceeds of a reverse mortgage, as authorized by section six-h of the banking law, and sections two hundred eighty and two hundred eighty-a of the real property law; provided, however, that monies used to repay a reverse mortgage may not be deducted from income, and provided additionally that any interest or dividends realized from the investment of reverse mortgage proceeds shall be considered income. The provisions of this paragraph notwithstanding, such income shall not include veterans disability compensation, as defined in Title 38 of the United States Code provided the governing board of such municipality, after public hearing, adopts a local law, ordinance or resolution providing therefor. In computing net rental income and net income from self-employment no depreciation deduction shall be allowed for the exhaustion, wear and tear of real or personal property held for the production of income; S 2. This act shall take effect immediately.

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