71st OREGON LEGISLATIVE ASSEMBLY--2001 Regular Session
NOTE: Matter within { + braces and plus signs + } in an
amended section is new. Matter within { - braces and minus
signs - } is existing law to be omitted. New sections are within
{ + braces and plus signs + } .
LC 3201
House Bill 3404
Sponsored by Representative DEVLIN; Representative KNOPP
SUMMARY
The following summary is not prepared by the sponsors of the
measure and is not a part of the body thereof subject to
consideration by the Legislative Assembly. It is an editor's
brief statement of the essential features of the measure as
introduced.
Establishes partial deferral of property taxes for individuals
65 years of age or older and with income below certain amount.
Applies to taxes imposed on property in tax years beginning on
or after July 1, 2002.
A BILL FOR AN ACT
Relating to deferral of property taxes; creating new provisions;
and amending ORS 311.668, 311.672, 311.676, 311.678, 311.688
and 311.689.
Be It Enacted by the People of the State of Oregon:
SECTION 1. ORS 311.668, as amended by section 2, chapter 1097,
Oregon Laws 1999, is amended to read:
311.668. (1) { - (a) - } Subject to ORS 311.670, an
individual, or two or more individuals jointly, may elect to
defer { + all or a portion of + } the property taxes on their
homestead by filing a claim for deferral with the county assessor
after January 1 and on or before April 15 of the first year in
which deferral is claimed if:
{ + (a) The individual has or, in the case of two or more
individuals filing a claim jointly, all of the individuals
together have household income, as defined in ORS 310.630, of
less than the amount identified in subsection (2) of this section
for the calendar year immediately preceding the calendar year in
which the claim is filed and: + }
(A) The individual, or, in the case of two or more individuals
filing a claim jointly, each individual, is 62 years of age or
older on April 15 of the year in which the claim is filed; or
(B) The individual is a disabled person on April 15 of the year
in which the claim is filed. In the case of individuals filing a
claim jointly, only one individual need be a disabled person in
order to make the election.
{ - (b) In order to make the election described in paragraph
(a) of this subsection, the individual must have, or in the case
of two or more individuals filing a claim jointly, all of the
individuals together must have household income, as defined in
ORS 310.630, for the calendar year immediately preceding the
calendar year in which the claim is filed of less than
$27,500. - }
{ + (b) The individual or, in the case of two or more
individuals filing a claim jointly, each individual is 65 years
of age or older on April 15 of the year in which the claim is
filed and the individual has or, in the case of two or more
individuals filing a claim jointly, all of the individuals
together have a household income, as defined in ORS 310.630, of
less than the maximum amount identified in subsection (3) of this
section for the calendar year immediately preceding the calendar
year in which the claim is filed.
(2) In the case of an individual or two or more individuals
filing jointly who qualify to defer property taxes under
subsection (1)(a) of this section, the individual or individuals
may defer 100 percent of the property taxes on their homestead if
the individual or individuals have a household income of less
than $27,500.
(3) In the case of an individual or two or more individuals
filing jointly who qualify to defer property taxes under
subsection (1)(b) of this section, the individual or individuals
may defer a portion of property taxes on their homestead as
follows:
(a) If household income is less than $27,500, the individual or
individuals qualify for a 100 percent deferral of property taxes.
(b) If household income is $27,500 or more but less than
$34,375, the individual or individuals qualify for a 75 percent
deferral of property taxes.
(c) If household income is $34,375 or more but less than
$41,250, the individual or individuals qualify for a 50 percent
deferral of property taxes.
(d) If household income is $41,250 or more but less than
$48,125, the individual or individuals qualify for a 25 percent
deferral of property taxes. + }
{ - (c) - } { + (4) + } The county assessor shall forward
each claim filed under this { - subsection - } { +
section + } to the Department of Revenue { + , + } which shall
determine if the property is eligible for deferral.
{ - (2) - } { + (5) + } When the taxpayer elects to defer
property taxes for any year by filing a claim for deferral under
subsection (1) of this section, it shall have the effect of:
(a) Deferring the payment of the property taxes levied on the
homestead for the fiscal year beginning on July 1 of such
year { + by the percentage designated in subsection (2) or (3)
of this section + }.
(b) Continuing the deferral of the payment by the taxpayer of
any property taxes deferred under ORS 311.666 to 311.701 for
previous years which have not become delinquent under ORS
311.686.
(c) Continuing the deferral of the payment by the taxpayer of
any future property taxes for as long as the provisions of ORS
311.670 are met.
{ - (3) - } { + (6) + } If a guardian or conservator has
been appointed for an individual otherwise qualified to obtain
deferral of taxes under ORS 311.666 to 311.701, the guardian or
conservator may act for such individual in complying with the
provisions of ORS 311.666 to 311.701.
{ - (4) - } { + (7) + } If a trustee of an inter vivos
trust which was created by and is revocable by an individual, who
is both the trustor and a beneficiary of the trust and who is
otherwise qualified to obtain a deferral of taxes under ORS
311.666 to 311.701, owns the fee simple estate under a recorded
instrument of sale, the trustee may act for the individual in
complying with the provisions of ORS 311.666 to 311.701.
{ - (5) - } { + (8) + } Nothing in this section shall be
construed to require a spouse of an individual to file a claim
jointly with the individual even though the spouse may be
eligible to claim the deferral jointly with the individual.
{ - (6) - } { + (9) + } Any person aggrieved by the denial
of a claim for deferral of homestead property taxes or
disqualification from deferral of homestead property taxes may
appeal in the manner provided by ORS 305.404 to 305.560.
{ - (7)(a) - } { + (10)(a) + } For each tax year beginning
on or after July 1, 2002, the Department of Revenue shall
recompute the { - maximum - } household income { + dollar
amount under subsection (2) of this section and the minimum and
maximum dollar amounts under subsection (3) of this section
+ }that may be incurred under an allowable claim for deferral
under subsection { - (1)(b) - } { + (2) or (3) + } of this
section. The computation shall be as follows:
(A) Divide the average U.S. City Average Consumer Price Index
for the first six months of the current calendar year by the
average U.S. City Average Consumer Price Index for the first six
months of 2001.
(B) Recompute the { - maximum - } household income
{ + dollar amounts + } by multiplying { - $27,500 - }
{ + the dollar amounts + }by the appropriate indexing factor
determined as provided in subparagraph (A) of this paragraph.
(b) As used in this subsection, 'U.S. City Average Consumer
Price Index' means the U.S. City Average Consumer Price Index for
All Urban Consumers (All Items) as published by the Bureau of
Labor Statistics of the United States Department of Labor.
(c) If any change in the { - maximum - } household
income { + dollar amounts + } determined under paragraph (a) of
this subsection is not a multiple of $500, the increase shall be
rounded to the nearest multiple of $500.
SECTION 2. ORS 311.672, as amended by section 3, chapter 1097,
Oregon Laws 1999, is amended to read:
311.672. (1) A taxpayer's claim for deferral under ORS 311.668
shall be in writing on a form supplied by the Department of
Revenue and shall:
(a) Describe the homestead.
(b) Recite facts establishing the eligibility for the deferral
under the provisions of ORS 311.666 to 311.701, including facts
that establish that the household income as defined in ORS
310.630 of the individual { - , - } or { + , + } in the case of
two or more individuals claiming the deferral jointly, of all of
the individuals together was, for the calendar year immediately
preceding the calendar year in which the claim is filed,
{ - less than or equal to the maximum - } { + an amount of + }
household income that may be incurred { - under an allowable
claim for deferral - } { + for the percentage of deferral of
property taxes being claimed + }, as provided in ORS 311.668.
(c) Have attached any documentary proof required by the
department to show that the requirements of ORS 311.666 to
311.701 have been met.
(2) There shall be annexed to the claim a statement verified by
a written declaration of the applicant making the claim to the
effect that the statements contained in the claim are true.
SECTION 3. ORS 311.676, as amended by section 4, chapter 1097,
Oregon Laws 1999, is amended to read:
311.676. (1) Upon determining the amount of deferred taxes on
tax-deferred property for the tax year, the Department of Revenue
shall pay to the respective county tax collectors an amount
equivalent to the deferred taxes less three percent thereof.
Payment shall be made from the revolving account established
under ORS 311.701.
(2) The department shall maintain accounts for each deferred
property and shall accrue interest only on the actual amount of
taxes advanced to the county.
(3) If only a portion of taxes are deferred under ORS { +
311.668 or + } 311.689, the department shall pay the portion that
is eligible for deferral to the tax collector and shall provide a
separate notice to the county assessor stating the amount of
property taxes that the department is paying.
SECTION 4. ORS 311.678 is amended to read:
311.678. (1) On or before December 15 of each year, the
Department of Revenue shall send a notice to each taxpayer who
has claimed deferral of property taxes for the current tax year.
The notice shall:
(a) Inform the taxpayer { - that the - } { + whether + }
property taxes have or have not been deferred in the current
year { + and if any property taxes have been deferred, the total
amount deferred in the current year + }.
(b) Show the total amount of deferred taxes remaining unpaid
since initial application for deferral and the interest accruing
therein to November 15 of the current year.
(c) Inform the taxpayer that voluntary payment of the deferred
taxes may be made at any time to the Department of Revenue.
(d) Contain any other information that the department considers
necessary to facilitate administration of the homestead deferral
program, including but not limited to the right of the taxpayer
to submit any elderly rental assistance amount received under ORS
310.630 to 310.706 to reduce the total amount of the deferred
taxes and interest.
(2) The department shall give the notice required under
subsection (1) of this section by an unsealed postcard or other
form of mail sent to the residence address of the taxpayer as
shown in the claim for deferral or as otherwise determined by the
department to be the correct address of the taxpayer.
SECTION 5. ORS 311.688 is amended to read:
311.688. (1) Notwithstanding ORS 311.684, when one of the
circumstances listed in ORS 311.684 (1) to (3) occurs, the spouse
who was not eligible to or did not file a claim jointly with the
taxpayer may continue the property in its deferred tax status by
filing a claim within the time and in the manner provided under
ORS 311.668 if:
(a) { + (A) For a claim filed under ORS 311.668 (1)(a), + } the
spouse of the taxpayer is or will be 60 years of age or older not
later than six months from the day the circumstance listed in ORS
311.684 (1) to (3) occurs; { + or
(B) For a claim filed under ORS 311.668 (1)(b), the spouse of
the taxpayer is or will be 63 years of age or older not later
than six months from the day the circumstances listed in ORS
311.684 (1) to (3) occurs; + } and
(b) The property is the homestead of the spouse of the taxpayer
and meets the requirements of ORS 311.670 (2).
(2) A spouse who does not meet the age { - requirements - }
{ + requirement + } of subsection (1)(a) of this section but is
otherwise qualified to continue the property in its tax-deferred
status under subsection (1) of this section may continue the
deferral of property taxes deferred for previous years by filing
a claim within the time and in the manner provided under ORS
311.668. If a spouse eligible for and continuing the deferral of
taxes previously deferred under this subsection becomes 62 years
of age { + , for a claim filed under ORS 311.668 (1)(a), or 65
years of age, for a claim filed under ORS 311.668 (1)(b), + }
prior to April 15 of any year, the spouse may elect to continue
the deferral of previous years' taxes deferred under this
subsection and may elect to defer the current assessment year's
taxes on the homestead by filing a claim within the time and in
the manner provided under ORS 311.668. Thereafter, payment of the
taxes levied on the homestead and deferred under this subsection
and payment of taxes levied on the homestead in the current
assessment year and in future years may be deferred in the manner
provided in and subject to ORS 311.666 to 311.701.
(3) Notwithstanding that ORS 311.668 requires that a claim be
filed no later than April 15, if the Department of Revenue
determines that good and sufficient cause exists for the failure
of a spouse to file a claim under this section on or before April
15, the claim may be filed within 180 days after notice of taxes
due and payable under ORS 311.686 is mailed or delivered by the
department to the taxpayer or spouse.
SECTION 6. ORS 311.689, as amended by section 7, chapter 1097,
Oregon Laws 1999, is amended to read:
311.689. (1) Notwithstanding ORS 311.668 or any other provision
of ORS 311.666 to 311.701, if the individual or, in the case of
two or more individuals electing to defer property taxes jointly,
all of the individuals together, or the spouse who has filed a
claim under ORS 311.688, has federal adjusted gross income
that { + :
(a) For claims filed under ORS 311.668 (1)(a), + }exceeds
$32,000 for the tax year that began in the previous calendar
year, then for the tax year next beginning, the amount of taxes
for which deferral is allowed shall be reduced by $0.50 for each
dollar of federal adjusted gross income in excess of
$32,000 { + ; or
(b) For claims filed under ORS 311.668 (1)(b), exceeds $55,000
for the tax year that began in the previous calendar year, then
for the tax year next beginning, the amount of taxes for which
deferral is allowed shall be reduced by $0.50 for each dollar of
federal adjusted gross income in excess of $55,000 + }.
(2) Prior to June 1 of each year, and notwithstanding ORS
314.835, the Department of Revenue shall review returns filed
under ORS { - chapter - } { + chapters + } 314 and 316 to
determine if subsection (1) of this section is applicable for a
homestead for the tax year next beginning. If subsection (1) of
this section is applicable, the department shall notify by mail
the taxpayer or spouse electing deferral, and the taxes otherwise
to be deferred for the tax year next beginning shall be reduced
as provided in subsection (1) of this section or, if federal
adjusted gross income in excess of { - $32,000 - } { + the
amounts identified in subsection (1) of this section + } exceeds
the amount of property taxes by a factor of two, the property
taxes shall not be deferred.
(3) If the taxpayer or spouse does not file a return for
purposes of ORS chapters 314 and 316 and the department has
reason to believe that the federal adjusted gross income of the
taxpayer or spouse exceeds { - $32,000 - } { + the amounts
identified in subsection (1) of this section + } for the tax year
that began in the previous calendar year, the department shall
notify by mail the taxpayer or spouse electing deferral. If,
within 30 days after the notice is mailed, the taxpayer or spouse
does not file a return under ORS chapter 314 or 316 or otherwise
satisfy the department that federal adjusted gross income does
not exceed { - $32,000 - } { + the amounts identified in
subsection (1) of this section + }, the department shall again
notify the taxpayer or spouse, and the taxes otherwise to be
deferred for the tax year next beginning shall not be deferred.
(4) For tax years beginning on or after July 1, 2002, the
federal adjusted gross income limit set forth in subsections (1)
to (3) of this section shall be recomputed by multiplying
{ - $32,000 - } { + the amounts identified in subsection (1)
of this section + } by the indexing factor described in ORS
311.668 { - (7)(a)(A) - } { + (10)(a)(A) + }, and rounding
the amount so computed to the nearest multiple of $500.
(5) Nothing in this section shall affect the continued deferral
of taxes that have been deferred for tax years beginning prior to
the tax year next beginning or the right to deferral of taxes for
a tax year beginning after the tax year next beginning if
subsection (1) is not applicable for that tax year for the
homestead.
(6) As used in this section, 'federal adjusted gross income'
means federal adjusted gross income of the individual or, in the
case of two or more individuals electing to defer property tax
jointly, the combined federal adjusted gross income of the
individuals, or the federal adjusted gross income of the spouse
who has filed a claim under ORS 311.688, all as determined for
the tax year beginning in the calendar year prior to which a
determination is required under subsection (2) of this section.
' Federal adjusted gross income' shall be determined under the
Internal Revenue Code, as amended and in effect on December 31,
1998, without any of the additions, subtractions or other
modifications or adjustments required under ORS chapter 314 or
316.
(7)(a) If, after an initial determination under this section
has been made by the department, upon audit or examination or
otherwise, it is discovered that the taxpayer or spouse had
federal adjusted gross income in excess of the limitation
provided under subsection (1) of this section, the department
shall determine the amount of taxes deferred that should not have
been deferred and give notice to the taxpayer or spouse of the
amount of taxes that should not have been deferred. The
provisions of ORS chapters 305 and 314 shall apply to a
determination of the department under this section in the same
manner as those provisions are applicable to an income tax
deficiency. The amount of deferred taxes that should not have
been deferred shall bear interest from the date paid by the
department until paid at the rate established under ORS 305.220
for deficiencies. A deficiency shall not be assessed under this
section if notice required under this section is not given to the
taxpayer or spouse within three years after the date that the
department has paid the deferred taxes to the county. Upon
payment of the amount assessed as deficiency, and interest, the
department shall execute a release in the amount of the payment
and the release shall be conclusive evidence of the removal and
extinguishment of the lien under ORS 311.666 to 311.701 to the
extent of the payment.
(b) If, after an initial determination under this section has
been made by the department, upon claim for refund, audit or
examination or otherwise, it is discovered that the taxpayer or
spouse had federal adjusted gross income in the amount of or less
than the limitation provided under subsection (1) of this
section, the department shall determine the amount of taxes
deferred that should have been deferred and give notice to the
taxpayer or spouse of the amount of taxes that should have been
deferred. The provisions of ORS chapters 305 and 314 shall apply
to a determination of the department under this section in the
same manner as those provisions are applicable to an income tax
refund. The amount of the taxes that should have been deferred
shall bear interest from the date paid by the taxpayer to the
county at the rate established under ORS 305.220 for refunds
until paid. Claim for refund under this paragraph must be filed
within three years after the earliest date that the taxpayer or
spouse is notified by the department that the taxes are not
deferred.
(8) This section applies to all tax-deferred property,
notwithstanding that election to defer taxes is made under ORS
311.666 to 311.701 before or after October 3, 1989.
SECTION 7. { + The amendments to ORS 311.668, 311.672,
311.676, 311.678, 311.688 and 311.689 by sections 1 to 6 of this
2001 Act apply to taxes imposed on property in tax years
beginning on or after July 1, 2002. + }
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