1     
CIRCUIT BREAKER AMENDMENTS

2     
2020 GENERAL SESSION

3     
STATE OF UTAH

4     
Chief Sponsor: Gene Davis

5     
House Sponsor: Robert M. Spendlove

6     

7     LONG TITLE
8     General Description:
9          This bill modifies provisions relating to the tax relief commonly known as "circuit
10     breaker."
11     Highlighted Provisions:
12          This bill:
13          ▸     modifies the qualifications for circuit breaker tax relief; and
14          ▸     makes technical changes.
15     Money Appropriated in this Bill:
16          None
17     Other Special Clauses:
18          This bill provides retrospective operation.
19     Utah Code Sections Affected:
20     AMENDS:
21          59-2-1202, as last amended by Laws of Utah 2019, Chapter 453
22          59-2-1203, as last amended by Laws of Utah 2001, Chapters 221 and 310
23          59-2-1206, as last amended by Laws of Utah 2001, Chapters 221 and 310
24          59-2-1220, as last amended by Laws of Utah 2001, Chapters 221 and 310
25     

26     Be it enacted by the Legislature of the state of Utah:
27          Section 1. Section 59-2-1202 is amended to read:
28          59-2-1202. Definitions.
29          As used in this part:
30          (1) (a) "Claimant" means a homeowner or renter who:
31          (i) files a claim under this part for a residence;
32          (ii) is domiciled in this state for the entire calendar year for which a claim for relief is
33     filed under this part; and
34          (iii) on or before the December 31 of the year for which a claim for relief is filed under
35     this part, is:
36          [(A) 65 years of age or older if the person was born on or before December 31, 1942;]
37          [(B)] (A) 66 years of age or older if the [person was born on or after January 1, 1943,
38     but] individual was born on or before December 31, 1959; or
39          [(C)] (B) 67 years of age or older if the [person] individual was born on or after
40     January 1, 1960.
41          (b) Notwithstanding Subsection (1)(a), "claimant" includes a surviving spouse:
42          (i) regardless of:
43          (A) the age of the surviving spouse; or
44          (B) the age of the deceased spouse at the time of death;
45          (ii) if the surviving spouse meets the requirements of this part except for the age
46     requirement;
47          (iii) if the surviving spouse is part of the same household of the deceased spouse at the
48     time of death of the deceased spouse; and
49          (iv) if the surviving spouse is unmarried at the time the surviving spouse files the
50     claim.
51          (c) If two or more individuals of a household are able to meet the qualifications for a
52     claimant, they may determine among them as to who the claimant shall be, but if they are
53     unable to agree, the matter shall be referred to the county legislative body for a determination
54     of the claimant of an owned residence and to the commission for a determination of the
55     claimant of a rented residence.
56          (2) (a) "Gross rent" means [rental] rent actually paid in cash or its equivalent solely for
57     the right of occupancy, at arm's-length, of a residence, exclusive of charges for any utilities,
58     services, furniture, furnishings, or personal appliances furnished by the landlord as a part of the
59     rental agreement.
60          (b) If a claimant occupies two or more residences in the year and does not own the
61     residence as of the lien date, "gross rent" means the total rent paid for the residences during the
62     one-year period for which the renter files a claim under this part.
63          (3) (a) "Homeowner" means:
64          (i) an individual whose name is listed on the deed of a residence; or
65          (ii) if a residence is owned in a qualifying trust, an individual who is a grantor, trustor,
66     or settlor or holds another similar role in the trust.
67          (b) "Homeowner" does not include:
68          (i) if a residence is owned by any type of entity other than a qualifying trust, an
69     individual who holds an ownership interest in that entity; or
70          (ii) an individual who is listed on a deed of a residence along with an entity other than
71     a qualifying trust.
72          [(3)] (4) "Homeowner's credit" means a credit against a claimant's property tax
73     liability.
74          [(4)] (5) "Household" means the association of [persons] individuals who live in the
75     same dwelling, sharing [its] the dwelling's furnishings, facilities, accommodations, and
76     expenses.
77          [(5)] (6) "Household income" means all income received by all [persons of a] members
78     of a claimant's household in:
79          (a) for a claimant who owns a residence, the calendar year preceding the calendar year
80     in which property taxes are due; or
81          (b) for [purposes of the renter's credit authorized by this part] a claimant who rents a
82     residence, the year for which a claim is filed.
83          [(6)] (7) (a) (i) "Income" means the sum of:
84          (A) federal adjusted gross income as defined in Section 62, Internal Revenue Code;
85     and
86          (B) all nontaxable income as defined in Subsection [(6)] (7)(b).
87          (ii) "Income" does not include:
88          (A) aid, assistance, or contributions from a tax-exempt nongovernmental source;
89          (B) surplus foods;
90          (C) relief in kind supplied by a public or private agency; or
91          (D) relief provided under this part or Part 18, Tax Deferral and Tax Abatement.
92          (b) For purposes of Subsection [(6)] (7)(a)(i), "nontaxable income" means amounts
93     excluded from adjusted gross income under the Internal Revenue Code, including:
94          (i) capital gains;
95          (ii) loss carry forwards claimed during the taxable year in which a claimant files for
96     relief under this part or Part 18, Tax Deferral and Tax Abatement;
97          (iii) depreciation claimed pursuant to the Internal Revenue Code by a claimant on the
98     residence for which the claimant files for relief under this part or Part 18, Tax Deferral and Tax
99     Abatement;
100          (iv) support money received;
101          (v) nontaxable strike benefits;
102          (vi) cash public assistance or relief;
103          (vii) the gross amount of a pension or annuity, including benefits under the Railroad
104     Retirement Act of 1974, 45 U.S.C. Sec. 231 et seq., and veterans disability pensions;
105          (viii) payments received under the Social Security Act;
106          (ix) state unemployment insurance amounts;
107          (x) nontaxable interest received from any source;
108          (xi) workers' compensation;
109          (xii) the gross amount of "loss of time" insurance; and
110          (xiii) voluntary contributions to a tax-deferred retirement plan.
111          [(7)] (8) (a) "Property taxes accrued" means property taxes, exclusive of special
112     assessments, delinquent interest, and charges for service, levied on 35% of the fair market
113     value, as reflected on the assessment roll, of a claimant's residence in this state.
114          (b) For a mobile home, "property taxes accrued" includes taxes imposed on both the
115     land upon which the home is situated and on the structure of the home itself, whether classified
116     as real property or personal property taxes.
117          [(c) (i) Beginning on January 1, 1999, for a claimant who owns a residence, "property
118     taxes accrued" are the property taxes described in Subsection (7)(a) levied for the calendar year
119     on 35% of the fair market value of the residence as reflected on the assessment roll.]
120          [(ii)] (c) The [amount] relief described in Subsection [(7)(c)(i)] (8)(a) constitutes:
121          [(A)] (i) a tax abatement for the poor in accordance with Utah Constitution, Article
122     XIII, Section 3; and
123          [(B)] (ii) the residential exemption provided for in Section 59-2-103.
124          (d) (i) For purposes of this Subsection [(7)] (8), property taxes accrued are levied on
125     the lien date.
126          (ii) If a claimant owns a residence on the lien date, property taxes accrued mean taxes
127     levied on the lien date, even if that claimant does not own a residence for the entire year.
128          (e) When a household owns and occupies two or more different residences in this state
129     in the same calendar year, property taxes accrued shall relate only to the residence occupied on
130     the lien date by the household as [its] the household's principal place of residence.
131          (f) (i) If a residence is an integral part of a large unit such as a farm or a multipurpose
132     or multidwelling building, property taxes accrued shall be [the same percentage of the total
133     property taxes accrued as] calculated on the percentage that the value of the residence is of the
134     total value of the unit.
135          (ii) For purposes of this Subsection [(7)] (8)(f), "unit" refers to the parcel of property
136     covered by a single tax statement of which the residence is a part.
137          (9) "Qualifying trust" means a trust holding title to real or tangible personal property
138     for which an individual:
139          (a) makes a claim under this part;
140          (b) proves to the satisfaction of the county that title to the portion of the trust will
141     revest in the individual upon the exercise of a power:
142          (i) by:
143          (A) the individual as grantor, trustor, settlor, or in another similar role of the trust;
144          (B) a nonadverse party; or
145          (C) both the individual and a nonadverse party; and
146          (ii) regardless of whether the power is a power:
147          (A) to revoke;
148          (B) to terminate;
149          (C) to alter;
150          (D) to amend; or
151          (E) to appoint; and
152          (c) is obligated to pay the taxes on that portion of the trust property beginning January
153     1 of the year the individual makes the claim.
154          [(8)] (10) (a) As used in this section, "rental assistance payment" means any payment
155     that:
156          (i) is made by a:
157          (A) governmental entity; [or]
158          (B) [(I)] charitable organization; or
159          [(II)] (C) religious organization; and
160          (ii) is specifically designated for the payment of rent of a claimant:
161          (A) for the calendar year for which the claimant seeks a renter's credit under this part;
162     and
163          (B) regardless of whether the payment is made to the:
164          (I) claimant; or
165          (II) landlord[; and].
166          (b) [in] In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act,
167     the commission may make rules defining the terms:
168          (i) "governmental entity";
169          (ii) "charitable organization"; or
170          (iii) "religious organization."
171          [(9)] (11) (a) (i) "Residence" means the dwelling, whether owned or rented, and so
172     much of the land surrounding [it] the dwelling, not exceeding one acre, as is reasonably
173     necessary for use of the dwelling as a home[, and may consist of].
174          (ii) "Residence" includes a dwelling that is:
175          (A) a part of a multidwelling or multipurpose building and a part of the land upon
176     which [it] the multidwelling or multipurpose building is built; and [includes]
177          (B) a mobile home or houseboat.
178          (b) "Residence" does not include personal property such as furniture, furnishings, or
179     appliances.
180          (c) For purposes of this Subsection [(9)] (11), "owned" includes a vendee in possession
181     under a land contract or one or more joint tenants or tenants in common.
182          Section 2. Section 59-2-1203 is amended to read:
183          59-2-1203. Right to file claim -- Death of claimant.
184          (1) (a) The right to file a claim under this part is personal to the claimant.
185          (b) The right to file a claim does not survive the claimant's death.
186          (c) The right to file a claim may be exercised on behalf of a claimant by:
187          (i) a legal guardian of the claimant; or
188          (ii) an attorney-in-fact of the claimant.
189          (2) (a) If a claimant dies after having filed a timely claim, the amount of the claim shall
190     be disbursed to another member of the household as determined by the commission by rule.
191          (b) If the claimant described in Subsection (2)(a) was the only member of the
192     household, the claim may be paid to the executor or administrator, except that if neither an
193     executor or administrator is appointed and qualified within two years of the filing of the claim,
194     the amount of the claim shall escheat to the state.
195          (3) If the claimant is the grantor [of a trust holding title to real or tangible personal
196     property on which a credit is claimed], trustor, or settlor of or holds another similar role in a
197     qualifying trust and the claimant meets the requirements of this part, the claimant may claim
198     the portion of the credit and be treated as the owner of that portion of the property held in trust
199     [for which the claimant proves to the satisfaction of the county that:].
200          [(a) title to the portion of the trust will revest in the claimant upon the exercise of a
201     power:]
202          [(i) by:]
203          [(A) the claimant as grantor of the trust;]
204          [(B) a nonadverse party; or]
205          [(C) both the claimant and a nonadverse party; and]
206          [(ii) regardless of whether the power is a power:]
207          [(A) to revoke;]
208          [(B) to terminate;]
209          [(C) to alter;]
210          [(D) to amend; or]
211          [(E) to appoint;]
212          [(b) the claimant is obligated to pay the taxes on that portion of the trust property
213     beginning January 1 of the year the claimant claims the credit; and]
214          [(c) the claimant meets the requirements under this part for the credit.]
215          (4) The [amount] relief described in Subsection 59-2-1202[(7)(c)(i)](8)(a) is in
216     addition to any other exemption or reduction for which a homeowner may be eligible,
217     including the homeowner's credit provided for in Section 59-2-1206.
218          Section 3. Section 59-2-1206 is amended to read:
219          59-2-1206. Application for homeowner's credit -- Time for filing -- Payment from
220     General Fund.
221          (1) (a) A claimant applying for a homeowner's credit shall file annually [file] an
222     application for the credit with the county before September 1.
223          (b) The application under this section shall:
224          (i) be on forms provided by:
225          (A) the commission; or
226          (B) the county in which the applicant resides; and
227          (ii) include a household income statement signed by the claimant stating that:
228          (A) the income statement is correct; and
229          (B) the claimant qualifies for the credit.
230          (c) (i) Subject to Subsection (1)(c)(ii), a county shall apply the credit in accordance
231     with this section and Section 59-2-1207 for the year in which the claimant applies for a
232     homeowner's credit if the claimant meets the criteria for obtaining a homeowner's credit as
233     provided in this part.
234          (ii) A homeowner's credit under this part may not exceed the claimant's property tax
235     liability for the year in which the claimant applies for a homeowner's credit under this part.
236          (d) A claimant may qualify for a homeowner's credit under this part regardless of
237     whether the claimant owes delinquent property taxes.
238          (2) (a) (i) The county shall compile a list of claimants and the homeowner's credits
239     granted to the claimants for purposes of obtaining payment from the General Fund for the
240     amount of credits granted.
241          (ii) A county may not obtain payment from the General Fund for the amount described
242     in Subsection 59-2-1202[(7)](8).
243          (b) Upon certification by the commission the payment for the credits under this
244     Subsection (2) shall be made to the county on or before January 1 if the list of claimants and
245     the credits granted are received by the commission on or before November 30 of the year in
246     which the credits under this part are granted.
247          (c) If the commission does not receive the list under this Subsection (2) on or before
248     November 30, payment shall be made within 30 days of receipt of the list of claimants and
249     credits from the county.
250          Section 4. Section 59-2-1220 is amended to read:
251          59-2-1220. Extension of time for filing claim -- County authority to make refunds.
252          (1) The commission or a county may extend the time for filing a claim until December
253     31 of the year the claim is required to be filed, if the commission or county finds that good
254     cause exists to extend the deadline.
255          (2) (a) For purposes of this Subsection (2):
256          (i) "Abatement" means the amount of property taxes accrued that constitutes a tax
257     abatement for the poor in accordance with Subsection 59-2-1202[(7)](8).
258          (ii) "Credit" means a homeowner's credit or renter's credit authorized by this part.
259          (iii) "Property taxes due" means the taxes due on a claimant's property:
260          (A) for which an abatement or a credit is granted by a county or the commission; and
261          (B) for the calendar year for which the abatement or credit is granted.
262          (iv) "Property taxes paid" is an amount equal to the sum of:
263          (A) the amount of the property taxes [the claimant] paid for the taxable year for which
264     the claimant is applying for the abatement or credit; and
265          (B) the amount of the abatement or credit the county or the commission grants.
266          (b) A county or the commission granting an abatement or a credit to a claimant shall
267     refund to that claimant an amount equal to the amount by which the claimant's property taxes
268     paid exceed the claimant's property taxes due, if that amount is $1 or more.
269          Section 5. Retrospective operation.
270          This bill has retrospective operation to January 1, 2020.