Citations Affected: IC 6-1.1-20.6.
Synopsis: Credit for certain homestead property taxes. Establishes,
subject to approval by the county fiscal body, a credit for property taxes
on a homestead in the amount by which the taxes exceed 2% of the
assessed value of the homestead. Authorizes the county to borrow
money to fund the credit, subject to repayment over not more than five
years by the county and political subdivisions in the county.
Effective: Upon passage.
January 25, 2005, read first time and referred to Committee on Ways and Means.
A BILL FOR AN ACT to amend the Indiana Code concerning
taxation.
1 of a calendar year to authorize the credit under this chapter
for property taxes first due and payable in the immediately
succeeding calendar year.
Sec. 3. If the credit under this chapter is authorized under
section 2 of this chapter for property taxes first due and payable in
a calendar year:
(1) a person is entitled to a credit against the person's
property tax liability for property taxes first due and payable
in that calendar year attributable to the person's homestead
located in the county; and
(2) the amount of the credit is the amount by which the
person's property tax liability attributable to the person's
homestead for property taxes first due and payable in that
calendar year exceeds two percent (2%) of the gross assessed
value that is the basis for determination of property taxes on
the homestead for property taxes first due and payable in that
calendar year.
Sec. 4. A person is not required to file an application for the
credit under this chapter. The county auditor shall:
(1) identify homesteads in the county eligible for the deduction
under this chapter; and
(2) apply the credit under this chapter to property tax liability
on the identified homesteads.
Sec. 5. (a) The fiscal body of a county may adopt an ordinance
to authorize the county fiscal officer to borrow money repayable
over a term not to exceed five (5) years in an amount sufficient to
compensate the political subdivisions located wholly or in part in
the county for the reduction of property tax collections in a
calendar year that results from the application of the credit under
this chapter for that calendar year.
(b) The county fiscal officer shall distribute in a calendar year
to each political subdivision located wholly or in part in the county
loan proceeds under subsection (a) for that calendar year in the
amount by which the property tax collections of the political
subdivision in that calendar year are reduced as a result of the
application of the credit under this chapter for that calendar year.
(c) If the county fiscal officer distributes money to political
subdivisions under subsection (b), the political subdivisions that
receive the distributions shall repay the loan under subsection (a)
over the term of the loan. Each political subdivision that receives
a distribution under subsection (b):
(1) shall:
(A) appropriate for each year in which the loan is to be
repaid an amount sufficient to pay the part of the principal
and interest on the loan attributable to the distribution
received by the political subdivision under subsection (b);
and
(B) subject to subsection (d), raise revenue in each year in
which the loan is to be repaid in the amount necessary to
meet the appropriation under subdivision (1); and
(2) other than the county, shall transfer to the county fiscal
officer money dedicated under this section to repayment of
the loan in time to allow the county to meet the loan
repayment schedule.
(d) A political subdivision that receives tax revenue under
IC 4-33-12-6, IC 4-33-13, or an agreement to share a city's or
county's part of the tax revenue must use that source of revenue
for the purpose of subsection (c)(1)(B) before raising revenue from
another source for that purpose.
(e) Property taxes imposed under subsection (c)(1)(B) are
subject to levy limitations under IC 6-1.1-18.5 or IC 6-1.1-19.
(f) The obligation to:
(1) repay; or
(2) contribute to the repayment of;
the loan under subsection (a) is not a basis for a political
subdivision to obtain an excessive tax levy under IC 6-1.1-18.5 or
IC 6-1.1-19.