Judy,
The homeowners' tax credit program is an income based program and is
different from the homestead tax credit program. Apparently, your
income is too large for that program.
I see that you did apply for and were approved for the homestead tax
credit. And your "special credit" will be all of $16.95.
Steve
On 7/6/12 12:30 PM, judy wrote:
Apparently, due to some formula I'm not familiar with, nor want to be
familiar with, I am NOT eligible for the 2012 MD homeowners' tax
credit program.
Judy Berlin
On 07/06/2012 12:02 PM, Stephen J Gewirtz wrote:
On your real estate tax bill, if you are eligible for the homestead
tax credit, there will be a "SPECIAL CREDIT." If you have looked at
the Sun or at the City announcement of the credit (and that is what I
essentially repeated in my earlier email about our coming real estate
tax bills), you would think that the credit was 0.02% of your
effective assessment. However, that is not the case. And it took
two of us on the phone over an hour to figure out how the credit
actually is calculated. I could see that my credit was bigger than
described earlier, but I assumed incorrectly that the City had erred
on my tax bill.
I checked the City Council legislation, and the credit is a
percentage of the assessed value of the improvements on your house,
with the percentage to be set each year by the Board of Estimates.
This year, it is 0.03% of the assessed value of the improvements.
The assessment for land is not part of the calculation, and the
amount of your homestead tax credit is not part of the calculation.
If you go to this website, http://sdatcert3.resiusa.org/rp_rewrite/ ,
you can look up your assessment. It is given as an assessment for
land, an assessment for improvements, and a total assessment. The
"SPECIAL CREDIT" is simply the assessment for improvements multiplied
by 0.0003 (0.03%).
For example, my assessment is land $90,000 and improvements $88,600,
with a total of $178,600. My State tax is 0.112% of $178,600, i.e.
$200.03. My City tax is 2.268% of $178,600, i.e. $4,050.65. From
these, the State and City homestead tax credits are subtracted (and
the result should be that your State tax should be 10% more than last
year, and your City tax should be 4% more than last year). This is
because the effective assessment (the assessment that you are
actually paying taxes on) can go up no more than 10% for State tax
purposes and 4% for City tax purposes. That is the effect of the
homestead tax credit. If you have owned your house for a long time,
your homestead tax credit will probably reduce your actual tax very
substantially.
This year, we have the additional "SPECIAL CREDIT," which is 0.03% of
the assessed value of the improvements on your property. In my case,
this number is 0.03% of $88,600, i.e. $26.58.
So what the City announced and what appeared in the Sun and what I
repeated do not accurately describe the "SPECIAL CREDIT." In
fairness to the City, they announced that it would be "approximately"
0.02% of the total assessment. But it is actually as I have
described it.
BTW, let me remind everyone to make sure that you have filed the
application for the homestead tax credit if you are eligible for it,
i.e. if you own your house and it is your principal residence and if
your spouse does not claim the credit on a different house. This
year, if you have gotten the homestead tax before, you will get it
again. But if you have not applied for the credit by the end of this
calendar year, you will lose it and the "SPECIAL CREDIT" for next
year and for succeeding years. When you look up your assessment, it
will say on the bottom of the page whether you have been approved for
the homestead tax credit. If you have not, go to
https://sdathtc.resiusa.org/homestead/
to file the application online.
Steve
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