H.B. 55 Enrolled

1

PROPERTY TAX - CIRCUIT BREAKER
2 QUALIFYING LIMITS
3 2006 GENERAL SESSION
4 STATE OF UTAH
5 Chief Sponsor: Wayne A. Harper
6 Senate Sponsor: Mike Dmitrich
7 Cosponsors:
8 Ralph Becker
9 LaVar Christensen
10 John Dougall
11 Ben C. FerryCraig A. Frank
Patricia W. Jones
Brad King
Todd E. KiserM. Susan Lawrence
Rosalind J. McGee
Merlynn T. Newbold
Stephen H. Urquhart 12
13 LONG TITLE
14 General Description:
15 This bill increases the homeowner's credit amounts and increases the household income
16 qualifying limits for both the homeowner's credit and the renter's credit.
17 Highlighted Provisions:
18 This bill:
19 . modifies the definition of a claimant to increase the age at which a claimant may
20 qualify for a homeowner's or renter's credit;
21 . increases the homeowner credit amounts that a claimant may claim;
22 . increases the household income qualifying limits for the homeowner's credit;
23 . increases the household income qualifying limits for the renter's credit; and
24 . makes technical changes.
25 Monies Appropriated in this Bill:
26 None
27 Other Special Clauses:
28 This bill takes effect on January 1, 2007.
29 Utah Code Sections Affected:
30 AMENDS:

31 59-2-1202, as last amended by Chapter 272, Laws of Utah 2003
32 59-2-1208, as last amended by Chapter 272, Laws of Utah 2003
33 59-2-1209, as last amended by Chapter 272, Laws of Utah 2003
34
35 Be it enacted by the Legislature of the state of Utah:
36 Section 1. Section 59-2-1202 is amended to read:
37 59-2-1202. Definitions.
38 As used in this part:
39 (1) (a) "Claimant" means a homeowner or renter who:
40 (i) has filed a claim under this part;
41 (ii) is domiciled in this state for the entire calendar year for which a claim for relief is
42 filed under this part; and
43 [(iii) has reached the age of 65 prior to the close of that calendar year.]
44 (iii) on or before the December 31 of the year for which a claim for relief is filed under
45 this part, is:
46 (A) 65 years of age or older if the person was born on or before December 31, 1942;
47 (B) 66 years of age or older if the person was born on or after January 1, 1943, but on
48 or before December 31, 1959; or
49 (C) 67 years of age or older if the person was born on or after January 1, 1960.
50 (b) A surviving spouse, who otherwise qualifies under this section, is an eligible
51 claimant regardless of age.
52 (c) If two or more individuals of a household are able to meet the qualifications for a
53 claimant, they may determine among them as to who the claimant shall be, but if they are
54 unable to agree, the matter shall be referred to the county legislative body for a determination
55 of the claimant of an owned residence and to the commission for a determination of the
56 claimant of a rented residence.
57 (2) (a) "Gross rent" means rental actually paid in cash or its equivalent solely for the
58 right of occupancy, at arm's-length, of a residence, exclusive of charges for any utilities,

59 services, furniture, furnishings, or personal appliances furnished by the landlord as a part of the
60 rental agreement.
61 (b) If a claimant occupies two or more residences in the year and does not own the
62 residence as of the lien date, "gross rent" means the total rent paid for the residences during the
63 one-year period for which the renter files a claim under this part.
64 (3) "Homeowner's credit" means a credit against a claimant's property tax liability.
65 (4) "Household" means the association of persons who live in the same dwelling,
66 sharing its furnishings, facilities, accommodations, and expenses.
67 (5) "Household income" means all income received by all persons of a household in:
68 (a) the calendar year preceding the calendar year in which property taxes are due; or
69 (b) for purposes of the renter's credit authorized by this part, the year for which a claim
70 is filed.
71 (6) (a) (i) "Income" means the sum of:
72 (A) federal adjusted gross income as defined in Section 62, Internal Revenue Code;
73 and
74 (B) all nontaxable income as defined in Subsection (6)(b).
75 (ii) "Income" does not include:
76 (A) aid, assistance, or contributions from a tax-exempt nongovernmental source;
77 (B) surplus foods;
78 (C) relief in kind supplied by a public or private agency; or
79 (D) relief provided under this part, Section 59-2-1108 , or Section 59-2-1109 .
80 (b) For purposes of Subsection (6)(a)(i), "nontaxable income" means amounts excluded
81 from adjusted gross income under the Internal Revenue Code, including:
82 (i) capital gains;
83 (ii) loss carry forwards claimed during the taxable year in which a claimant files for
84 relief under this part, Section 59-2-1108 , or Section 59-2-1109 ;
85 (iii) depreciation claimed pursuant to the Internal Revenue Code by a claimant on the
86 residence for which the claimant files for relief under this part, Section 59-2-1108 , or Section

87 59-2-1109 ;
88 (iv) support money received;
89 (v) nontaxable strike benefits;
90 (vi) cash public assistance or relief;
91 (vii) the gross amount of a pension or annuity, including benefits under the Railroad
92 Retirement Act of 1974, 45 U.S.C. Sec. 231 et seq., and veterans disability pensions;
93 (viii) payments received under the Social Security Act;
94 (ix) state unemployment insurance amounts;
95 (x) nontaxable interest received from any source;
96 (xi) workers' compensation;
97 (xii) the gross amount of "loss of time" insurance; and
98 (xiii) voluntary contributions to a tax-deferred retirement plan.
99 (7) (a) "Property taxes accrued" means property taxes, exclusive of special
100 assessments, delinquent interest, and charges for service, levied on a claimant's residence in
101 this state.
102 (b) For a mobile home, "property taxes accrued" includes taxes imposed on both the
103 land upon which the home is situated and on the structure of the home itself, whether classified
104 as real property or personal property taxes.
105 (c) (i) Beginning on January 1, 1999, for a claimant who owns a residence, "property
106 taxes accrued" are the property taxes described in Subsection (7)(a) levied for the calendar year
107 on 35% of the fair market value of the residence as reflected on the assessment roll.
108 (ii) The amount described in Subsection (7)(c)(i) constitutes:
109 (A) a tax abatement for the poor in accordance with Utah Constitution Article XIII,
110 Section 3; and
111 (B) the residential exemption provided for in Section 59-2-103 .
112 (d) (i) For purposes of this Subsection (7) property taxes accrued are levied on the lien
113 date.
114 (ii) If a claimant owns a residence on the lien date, property taxes accrued mean taxes

115 levied on the lien date, even if that claimant does not own a residence for the entire year.
116 (e) When a household owns and occupies two or more different residences in this state
117 in the same calendar year, property taxes accrued shall relate only to the residence occupied on
118 the lien date by the household as its principal place of residence.
119 (f) (i) If a residence is an integral part of a large unit such as a farm or a multipurpose
120 or multidwelling building, property taxes accrued shall be the same percentage of the total
121 property taxes accrued as the value of the residence is of the total value.
122 (ii) For purposes of this Subsection (7)(f), "unit" refers to the parcel of property
123 covered by a single tax statement of which the residence is a part.
124 (8) (a) As used in this section, "rental assistance payment" means any payment that:
125 (i) is made by a:
126 (A) governmental entity; or
127 (B) (I) charitable organization; or
128 (II) religious organization; and
129 (ii) is specifically designated for the payment of rent of a claimant:
130 (A) for the calendar year for which the claimant seeks a renter's credit under this part;
131 and
132 (B) regardless of whether the payment is made to the:
133 (I) claimant; or
134 (II) landlord; and
135 (b) in accordance with Title 63, Chapter 46a, Utah Administrative Rulemaking Act, the
136 commission may make rules defining the terms:
137 (i) "governmental entity";
138 (ii) "charitable organization"; or
139 (iii) "religious organization."
140 (9) (a) "Residence" means the dwelling, whether owned or rented, and so much of the
141 land surrounding it, not exceeding one acre, as is reasonably necessary for use of the dwelling
142 as a home, and may consist of a part of a multidwelling or multipurpose building and a part of

143 the land upon which it is built and includes a mobile home or houseboat.
144 (b) "Residence" does not include personal property such as furniture, furnishings, or
145 appliances.
146 (c) For purposes of this Subsection (9), "owned" includes a vendee in possession under
147 a land contract or one or more joint tenants or tenants in common.
148 Section 2. Section 59-2-1208 is amended to read:
149 59-2-1208. Amount of homeowner's credit -- Cost-of-living adjustment --
150 Limitation -- General Fund as source of credit.
151 (1) (a) Subject to Subsection (2), for calendar years beginning on or after January 1,
152 [1998] 2007, a claimant may claim a homeowner's credit that does not exceed the following
153 amounts:
154 If household income is Homeowner's credit
155 [$0 -- $7,358] $0 -- $9,159 [$577] $798
156 [$7,359 -- $9,812] $9,160 -- $12,214 [$504] $696
157 [$9,813 -- $12,264] $12,215 -- $15,266 [$432] $597
158 [$12,265 -- $14,717] $15,267 -- $18,319 [$324] $447
159 [$14,718 -- $17,171] $18,320 -- $21,374 [$252] $348
160 [$17,172 -- $19,479] $21,375 -- $24,246 [$144] $199
161 [$19,480 -- $21,644] $24,247 -- $26,941 [$71] $98
162 (b) (i) For calendar years beginning on or after January 1, [1999] 2008, the commission
163 shall increase or decrease the household income eligibility amounts and the credits under
164 Subsection (1)(a) by a percentage equal to the percentage difference between the consumer
165 price index for the preceding calendar year and the consumer price index for calendar year
166 [1997] 2006.
167 (ii) For purposes of Subsection (1)(b)(i), the commission shall calculate the consumer
168 price index as provided in Sections 1(f)(4) and 1(f)(5), Internal Revenue Code.
169 (2) An individual who is claimed as a personal exemption on another individual's
170 individual income tax return during any portion of a calendar year for which the individual

171 seeks to claim a homeowner's credit under this section may not receive the homeowner's credit.
172 (3) The homeowner's credit allowed by this section, and provided for in Section
173 59-2-1204 , shall be derived from the General Fund and appropriate transfers made to effectuate
174 this credit.
175 Section 3. Section 59-2-1209 is amended to read:
176 59-2-1209. Amount of renter's credit -- Cost-of-living adjustment -- Limitation --
177 General Fund as source of credit -- Maximum credit -- Renter's credit may be claimed
178 only for rent that does not constitute a rental assistance payment.
179 (1) (a) Subject to Subsections (2) and (3), for [any] calendar [year] years beginning on
180 or after January 1, 2007, a claimant may claim a renter's credit for the previous calendar year
181 that does not exceed the following amounts:
182 If household income is Percentage of rent
183 allowed as a credit
184 [$0 -- $7,358] $0 -- $9,159 9.5%
185 [$7,359 -- $9,812] $9,160 -- $12,214 8.5%
186 [$9,813 -- $12,264] $12,215 -- $15,266 7.0%
187 [$12,265 -- $14,717] $15,267 -- $18,319 5.5%
188 [$14,718 -- $17,171] $18,320 -- $21,374 4.0%
189 [$17,172 -- $19,479] $21,375 -- $24,246 3.0%
190 [$19,480 -- $21,644] $24,247 -- $26,941 2.5%
191 (b) (i) For calendar years beginning on or after January 1, [1999] 2008, the commission
192 shall increase or decrease the household income eligibility amounts under Subsection (1)(a) by
193 a percentage equal to the percentage difference between the consumer price index for the
194 preceding calendar year and the consumer price index for calendar year [1997] 2006.
195 (ii) For purposes of Subsection (1)(b)(i), the commission shall calculate the consumer
196 price index as provided in Sections 1(f)(4) and 1(f)(5), Internal Revenue Code.
197 (2) A claimant may claim a renter's credit under this part only for rent that does not
198 constitute a rental assistance payment.

199 (3) An individual who is claimed as a personal exemption on another individual's
200 individual income tax return during any portion of a calendar year for which the individual
201 seeks to claim a renter's credit under this section may not receive a renter's credit.
202 (4) The renter's credit allowed by this section, and provided for in Section 59-2-1204 ,
203 shall be derived from the General Fund and appropriate transfers made to effectuate this credit.
204 (5) For calendar years beginning on or after January 1, [1998] 2007, a credit under this
205 section may not exceed the maximum amount allowed as a homeowner's credit for each
206 income bracket under Subsection 59-2-1208 (1)(a).
207 Section 4. Effective date.
208 This bill takes effect on January 1, 2007.