House File 166 Disabled Veteran Property Tax Credit

HOUSE REPUBLICAN STAFF ANALYSIS Bill: Committee: Floor Manager: Date: Staff: House File 166 Ways and Means Rep. Nunn Fe...

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HOUSE REPUBLICAN STAFF ANALYSIS Bill: Committee: Floor Manager: Date: Staff:

House File 166 Ways and Means Rep. Nunn February 23, 2015 Kristi L. Kious (2-5290)

House Veteran Affairs: House Ways & Means: House Floor: Senate Floor: Governor:

PASSED on February 3 (15-0) PASSED on February 11 (23-0)

Disabled Veteran Homestead Tax Credit  Amends the eligibility criteria for the disabled veteran homestead tax credit to include a veteran with a disability rating based on individual unemployability.  Fiscal Note – $560,000 in FY 16 (General Fund) $2.4 million in FY 17 and thereafter (General Fund) The current balance sheet estimate for the Homestead Tax Credit is $135 million for FY 16. That number is estimated to be sufficient to cover current claims and the estimated additional claims under HF 166. Additionally, absent a noticeable increase in property taxes—the $135 million appropriation should be sufficient to fully fund the Homestead and Disabled Veteran Homestead Credits in future fiscal years.

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Section by Section Analysis Sections 1 through 3 – Disabled Veteran Tax Credit Current law provides a homestead tax credit to the owner of a homestead for the full amount of tax levied (a total property tax credit) if the owner:  is a veteran who acquired the homestead under specified federal programs (adaptive housing),  is a veteran with a service-connected disability rating of 100 percent,  is a former member of the national guard who meets specified service requirements with a serviceconnected disability rating of 100 percent, or  is an individual who is a surviving spouse or a child and who is receiving dependency and indemnity compensation These sections amend this eligibility criterion to include those veterans with a permanent and total disability rating based on individual unemployability that is compensated at the 100 percent level. The bill defines permanent and total disability rating based on individual unemployability to mean a condition under which a person has either  a permanent service-connected disability rating of 60 percent or  two or more permanent service-connected disability conditions in which one of the conditions has at least a 40 percent rating and the combined rating for all the conditions is at least 70 percent 1



and the person has an administrative adjustment added due to individual unemployability such that they are being paid at a permanent and total disability level.

Section 4 – Effective Upon Enactment This section makes the legislation effective upon enactment. Section 5 – Retroactive Applicability This section makes the legislation apply retroactively to May 26, 2014 for applications for the homestead credit filed on or after that date.

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