Bill Text: IN HB1086 | 2011 | Regular Session | Introduced

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Bill Title: Deduction for blind or disabled dependent.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced - Dead) 2011-01-05 - First reading: referred to Committee on Ways and Means [HB1086 Detail]

Download: Indiana-2011-HB1086-Introduced.html

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Introduced Version

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HOUSE BILL No. 1086

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DIGEST OF INTRODUCED BILL

Citations Affected: IC 6-1.1-12.

Synopsis: Deduction for blind or disabled dependent. Establishes a $12,480 property tax assessed value deduction on the residence of an individual who has a dependent who: (1) is blind or otherwise disabled; and (2) resides with the individual.

Effective: January 1, 2011 (retroactive).

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Pelath

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    January 5, 2011, read first time and referred to Committee on Ways and Means.

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Introduced

First Regular Session 117th General Assembly (2011)

PRINTING CODE. Amendments: Whenever an existing statute (or a section of the Indiana Constitution) is being amended, the text of the existing provision will appear in this style type, additions will appear in this style type, and deletions will appear in this style type.
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Conflict reconciliation: Text in a statute in this style type or this style type reconciles conflicts between statutes enacted by the 2010 Regular Session of the General Assembly.

HOUSE BILL No. 1086

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    A BILL FOR AN ACT to amend the Indiana Code concerning taxation.

Be it enacted by the General Assembly of the State of Indiana:

SOURCE: IC 6-1.1-12-11.5; (11)IN1086.1.1. -->     SECTION 1. IC 6-1.1-12-11.5 IS ADDED TO THE INDIANA CODE AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JANUARY 1, 2011 (RETROACTIVE)]: Sec. 11.5. (a) Except as provided in section 40.5 of this chapter, for assessments that are the basis for property taxes first due and payable after 2011, an individual may have the sum of twelve thousand four hundred eighty dollars ($12,480) deducted from the assessed value of real property, a mobile home not assessed as real property, or a manufactured home not assessed as real property that the individual owns, or that the individual is buying under a contract that provides that the individual is to pay property taxes on the real property, mobile home, or manufactured home, if the contract or a memorandum of the contract is recorded in the county recorder's office, and if:
        (1) the individual claims one (1) or more dependents on the individual's federal or state income tax return or returns;
        (2) the real property, mobile home, or manufactured home is

principally used and occupied by:
            (A) the individual as the individual's residence; and
            (B) at least one (1) of the dependents referred to in subdivision (1) as the dependent's residence;
        (3) at least one (1) of the dependents who resides with the individual as described in subdivision (2) is blind or has a disability; and
        (4) the individual:
            (A) owns the real property, mobile home, or manufactured home; or
            (B) is buying the real property, mobile home, or manufactured home under contract;
        on the date the application required by section 12 of this chapter is filed.
    (b) For purposes of this section, "blind" has the meaning set forth in IC 12-7-2-21(1).
    (c) For purposes of this section, a dependent is considered to have a disability if the dependent is unable to engage in any substantial gainful activity by reason of a medically determinable physical or mental impairment that:
        (1) can be expected to result in death; or
        (2) has lasted or can be expected to last for a continuous period of not less than twelve (12) months.
    (d) An individual filing a claim for a deduction under this section must submit proof of disability of the dependent in the form and manner prescribed by rule by the department of local government finance. Proof that a dependent is eligible to receive disability benefits under the federal Social Security Act (42 U.S.C. 301 et seq.) constitutes proof of disability for purposes of this section.
    (e) A dependent with a disability not covered under the federal Social Security Act must be examined by a physician, and the dependent's disability shall be determined by using the same standards as used by the Social Security Administration. The costs of this examination shall be borne by the claimant.
    (f) An individual who has sold real property, a mobile home not assessed as real property, or a manufactured home not assessed as real property to another person under a contract that provides that the contract buyer is to pay the property taxes on the real property, mobile home, or manufactured home may not claim the deduction provided under this section against that real property, mobile home, or manufactured home.

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SOURCE: IC 6-1.1-12-12; (11)IN1086.1.2. -->     SECTION 2. IC 6-1.1-12-12, AS AMENDED BY P.L.1-2009, SECTION 29, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JANUARY 1, 2011 (RETROACTIVE)]: Sec. 12. (a) Except as provided in section 17.8 of this chapter and subject to section 45 of this chapter, a person who desires to claim the deduction provided in section 11 or 11.5 of this chapter must file an application, on forms prescribed by the department of local government finance, with the auditor of the county in which the real property, mobile home not assessed as real property, or manufactured home not assessed as real property is located. With respect to real property, the application must be filed during the year for which the individual wishes to obtain the deduction. With respect to a mobile home that is not assessed as real property or a manufactured home that is not assessed as real property, the application must be filed during the twelve (12) months before March 31 of each year for which the individual wishes to obtain the deduction. The application may be filed in person or by mail. If mailed, the mailing must be postmarked on or before the last day for filing.
    (b) Proof of blindness may be supported by:
        (1) the records of the division of family resources or the division of disability and rehabilitative services; or
        (2) the written statement of a physician who is licensed by this state and skilled in the diseases of the eye or of a licensed optometrist.
    (c) The application required by this section must contain the record number and page where the contract or memorandum of the contract is recorded if the individual is buying the real property, mobile home, or manufactured home on a contract that provides that the individual is to pay property taxes on the real property, mobile home, or manufactured home.

SOURCE: IC 6-1.1-12-17.8; (11)IN1086.1.3. -->     SECTION 3. IC 6-1.1-12-17.8, AS AMENDED BY P.L.182-2009(ss), SECTION 109, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JANUARY 1, 2011 (RETROACTIVE)]: Sec. 17.8. (a) An individual who receives a deduction provided under section 1, 9, 11, 11.5, 13, 14, 16, 17.4, or 37 of this chapter in a particular year and who remains eligible for the deduction in the following year is not required to file a statement to apply for the deduction in the following year. However, for purposes of a deduction under section 37 of this chapter, the county auditor may, in the county auditor's discretion, terminate the deduction for assessment dates after January 15, 2012, if the individual does not comply with the requirement in IC 6-1.1-22-8.1(b)(9), as determined by the county auditor, before January 1, 2013. Before the county auditor terminates

the deduction because the taxpayer claiming the deduction did not comply with the requirement in IC 6-1.1-22-8.1(b)(9) before January 1, 2013, the county auditor shall mail notice of the proposed termination of the deduction to:
        (1) the last known address of each person liable for any property taxes or special assessment, as shown on the tax duplicate or special assessment records; or
        (2) the last known address of the most recent owner shown in the transfer book.
    (b) An individual who receives a deduction provided under section 1, 9, 11, 11.5, 13, 14, 16, or 17.4 of this chapter in a particular year and who becomes ineligible for the deduction in the following year shall notify the auditor of the county in which the real property, mobile home, or manufactured home for which the individual claims the deduction is located of the individual's ineligibility in the year in which the individual becomes ineligible. An individual who becomes ineligible for a deduction under section 37 of this chapter shall notify the county auditor of the county in which the property is located in conformity with section 37 of this chapter.
    (c) The auditor of each county shall, in a particular year, apply a deduction provided under section 1, 9, 11, 11.5, 13, 14, 16, 17.4, or 37 of this chapter to each individual who received the deduction in the preceding year unless the auditor determines that the individual is no longer eligible for the deduction.
    (d) An individual who receives a deduction provided under section 1, 9, 11, 11.5, 13, 14, 16, 17.4, or 37 of this chapter for property that is jointly held with another owner in a particular year and remains eligible for the deduction in the following year is not required to file a statement to reapply for the deduction following the removal of the joint owner if:
        (1) the individual is the sole owner of the property following the death of the individual's spouse;
        (2) the individual is the sole owner of the property following the death of a joint owner who was not the individual's spouse; or
        (3) the individual is awarded sole ownership of the property in a divorce decree.
However, for purposes of a deduction under section 37 of this chapter, if the removal of the joint owner occurs before the date that a notice described in IC 6-1.1-22-8.1(b)(9) is sent, the county auditor may, in the county auditor's discretion, terminate the deduction for assessment dates after January 15, 2012, if the individual does not comply with the requirement in IC 6-1.1-22-8.1(b)(9), as determined by the county

auditor, before January 1, 2013. Before the county auditor terminates the deduction because the taxpayer claiming the deduction did not comply with the requirement in IC 6-1.1-22-8.1(b)(9) before January 1, 2013, the county auditor shall mail notice of the proposed termination of the deduction to the last known address of each person liable for any property taxes or special assessment, as shown on the tax duplicate or special assessment records or the last known address of the most recent owner shown in the transfer book.
    (e) A trust entitled to a deduction under section 9, 11, 11.5, 13, 14, 16, 17.4, or 37 of this chapter for real property owned by the trust and occupied by an individual in accordance with section 17.9 of this chapter is not required to file a statement to apply for the deduction, if:
        (1) the individual who occupies the real property receives a deduction provided under section 9, 11, 11.5, 13, 14, 16, 17.4, or 37 of this chapter in a particular year; and
        (2) the trust remains eligible for the deduction in the following year.
However, for purposes of a deduction under section 37 of this chapter, the individuals that qualify the trust for a deduction must comply with the requirement in IC 6-1.1-22-8.1(b)(9) before January 1, 2013.
    (f) A cooperative housing corporation (as defined in 26 U.S.C. 216) that is entitled to a deduction under section 37 of this chapter in the immediately preceding calendar year for a homestead (as defined in section 37 of this chapter) is not required to file a statement to apply for the deduction for the current calendar year if the cooperative housing corporation remains eligible for the deduction for the current calendar year. However, the county auditor may, in the county auditor's discretion, terminate the deduction for assessment dates after January 15, 2012, if the individual does not comply with the requirement in IC 6-1.1-22-8.1(b)(9), as determined by the county auditor, before January 1, 2013. Before the county auditor terminates a deduction because the taxpayer claiming the deduction did not comply with the requirement in IC 6-1.1-22-8.1(b)(9) before January 1, 2013, the county auditor shall mail notice of the proposed termination of the deduction to:
        (1) the last known address of each person liable for any property taxes or special assessment, as shown on the tax duplicate or special assessment records; or
        (2) the last known address of the most recent owner shown in the transfer book.
    (g) An individual who:
        (1) was eligible for a homestead credit under IC 6-1.1-20.9

(repealed) for property taxes imposed for the March 1, 2007, or January 15, 2008, assessment date; or
        (2) would have been eligible for a homestead credit under IC 6-1.1-20.9 (repealed) for property taxes imposed for the March 1, 2008, or January 15, 2009, assessment date if IC 6-1.1-20.9 had not been repealed;
is not required to file a statement to apply for a deduction under section 37 of this chapter if the individual remains eligible for the deduction in the current year. An individual who filed for a homestead credit under IC 6-1.1-20.9 (repealed) for an assessment date after March 1, 2007 (if the property is real property), or after January 1, 2008 (if the property is personal property), shall be treated as an individual who has filed for a deduction under section 37 of this chapter. However, the county auditor may, in the county auditor's discretion, terminate the deduction for assessment dates after January 15, 2012, if the individual does not comply with the requirement in IC 6-1.1-22-8.1(b)(9), as determined by the county auditor, before January 1, 2013. Before the county auditor terminates the deduction because the taxpayer claiming the deduction did not comply with the requirement in IC 6-1.1-22-8.1(b)(9) before January 1, 2013, the county auditor shall mail notice of the proposed termination of the deduction to the last known address of each person liable for any property taxes or special assessment, as shown on the tax duplicate or special assessment records, or to the last known address of the most recent owner shown in the transfer book.
    (h) If a county auditor terminates a deduction because the taxpayer claiming the deduction did not comply with the requirement in IC 6-1.1-22-8.1(b)(9) before January 1, 2013, the county auditor shall reinstate the deduction if the taxpayer provides proof that the taxpayer is eligible for the deduction and is not claiming the deduction for any other property.
    (i) A taxpayer described in section 37(k) of this chapter is not required to file a statement to apply for the deduction provided by section 37 of this chapter for a calendar year beginning after December 31, 2008, if the property owned by the taxpayer remains eligible for the deduction for that calendar year. However, the county auditor may terminate the deduction for assessment dates after January 15, 2012, if the individual residing on the property owned by the taxpayer does not comply with the requirement in IC 6-1.1-22-8.1(b)(9), as determined by the county auditor, before January 1, 2013. Before the county auditor terminates a deduction because the individual residing on the property did not comply with the requirement in IC 6-1.1-22-8.1(b)(9) before January 1, 2013, the county auditor shall mail notice of the

proposed termination of the deduction to:
        (1) the last known address of each person liable for any property taxes or special assessment, as shown on the tax duplicate or special assessment records; or
        (2) the last known address of the most recent owner shown in the transfer book.

SOURCE: IC 6-1.1-12-17.9; (11)IN1086.1.4. -->     SECTION 4. IC 6-1.1-12-17.9, AS AMENDED BY P.L.101-2008, SECTION 2, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JANUARY 1, 2011 (RETROACTIVE)]: Sec. 17.9. A trust is entitled to a deduction under section 9, 11, 11.5, 13, 14, 16, or 17.4 of this chapter for real property owned by the trust and occupied by an individual if the county auditor determines that the individual:
        (1) upon verification in the body of the deed or otherwise, has either:
            (A) a beneficial interest in the trust; or
            (B) the right to occupy the real property rent free under the terms of a qualified personal residence trust created by the individual under United States Treasury Regulation 25.2702-5(c)(2);
        (2) otherwise qualifies for the deduction; and
        (3) would be considered the owner of the real property under IC 6-1.1-1-9(f) or IC 6-1.1-1-9(g).

SOURCE: IC 6-1.1-12-43; (11)IN1086.1.5. -->     SECTION 5. IC 6-1.1-12-43, AS AMENDED BY P.L.87-2009, SECTION 4, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JANUARY 1, 2011 (RETROACTIVE)]: Sec. 43. (a) For purposes of this section:
        (1) "benefit" refers to a deduction under section 1, 9, 11, 11.5, 13, 14, 16, 17.4, 26, 29, 31, 33, 34, 37, or 37.5 of this chapter;
        (2) "closing agent" means a person that closes a transaction;
        (3) "customer" means an individual who obtains a loan in a transaction; and
        (4) "transaction" means a single family residential:
            (A) first lien purchase money mortgage transaction; or
            (B) refinancing transaction.
    (b) Before closing a transaction after December 31, 2004, a closing agent must provide to the customer the form referred to in subsection (c).
    (c) Before June 1, 2004, the department of local government finance shall prescribe the form to be provided by closing agents to customers under subsection (b). The department shall make the form available to closing agents, county assessors, county auditors, and county treasurers in hard copy and electronic form. County assessors, county auditors,

and county treasurers shall make the form available to the general public. The form must:
        (1) on one (1) side:
            (A) list each benefit;
            (B) list the eligibility criteria for each benefit; and
            (C) indicate that a new application for a deduction under section 1 of this chapter is required when residential real property is refinanced;
        (2) on the other side indicate:
            (A) each action by and each type of documentation from the customer required to file for each benefit; and
            (B) sufficient instructions and information to permit a party to terminate a standard deduction under section 37 of this chapter on any property on which the party or the spouse of the party will no longer be eligible for the standard deduction under section 37 of this chapter after the party or the party's spouse begins to reside at the property that is the subject of the closing, including an explanation of the tax consequences and applicable penalties, if a party unlawfully claims a standard deduction under section 37 of this chapter; and
        (3) be printed in one (1) of two (2) or more colors prescribed by the department of local government finance that distinguish the form from other documents typically used in a closing referred to in subsection (b).
    (d) A closing agent:
        (1) may reproduce the form referred to in subsection (c);
        (2) in reproducing the form, must use a print color prescribed by the department of local government finance; and
        (3) is not responsible for the content of the form referred to in subsection (c) and shall be held harmless by the department of local government finance from any liability for the content of the form.
    (e) This subsection applies to a transaction that is closed after December 31, 2009. In addition to providing the customer the form described in subsection (c) before closing the transaction, a closing agent shall do the following as soon as possible after the closing, and within the time prescribed by the department of insurance under IC 27-7-3-15.5:
        (1) To the extent determinable, input the information described in IC 27-7-3-15.5(c)(2) into the system maintained by the department of insurance under IC 27-7-3-15.5.
        (2) Submit the form described in IC 27-7-3-15.5(c) to the data

base described in IC 27-7-3-15.5(c)(2)(D).
    (f) A closing agent to which this section applies shall document the closing agent's compliance with this section with respect to each transaction in the form of verification of compliance signed by the customer.
    (g) Subject to IC 27-7-3-15.5(d), a closing agent is subject to a civil penalty of twenty-five dollars ($25) for each instance in which the closing agent fails to comply with this section with respect to a customer. The penalty:
        (1) may be enforced by the state agency that has administrative jurisdiction over the closing agent in the same manner that the agency enforces the payment of fees or other penalties payable to the agency; and
        (2) shall be paid into:
            (A) the state general fund, if the closing agent fails to comply with subsection (b); or
            (B) the home ownership education account established by IC 5-20-1-27, if the closing agent fails to comply with subsection (e) in a transaction that is closed after December 31, 2009.
    (h) A closing agent is not liable for any other damages claimed by a customer because of:
        (1) the closing agent's mere failure to provide the appropriate document to the customer under subsection (b); or
        (2) with respect to a transaction that is closed after December 31, 2009, the closing agent's failure to input the information or submit the form described in subsection (e).
    (i) The state agency that has administrative jurisdiction over a closing agent shall:
        (1) examine the closing agent to determine compliance with this section; and
        (2) impose and collect penalties under subsection (g).

SOURCE: ; (11)IN1086.1.6. -->     SECTION 6. An emergency is declared for this act.