HP0367, LD 474, item 1, An Act To Reduce the Property Tax Burden and Improve the Circuitbreaker Program

An Act To Reduce the Property Tax Burden and Improve the Circuitbreaker Program

Emergency preamble. Whereas, acts and resolves of the Legislature do not become effective until 90 days after adjournment unless enacted as emergencies; and

Whereas, the application period for the Circuitbreaker Program begins on August 1st; and

Whereas, it is necessary for administrative efficiency and to avoid confusion that changes be made to the Circuitbreaker Program by the beginning of the application period; and

Whereas, in the judgment of the Legislature, these facts create an emergency within the meaning of the Constitution of Maine and require the following legislation as immediately necessary for the preservation of the public peace, health and safety; now, therefore,

Be it enacted by the People of the State of Maine as follows:

Sec. 1. 36 MRSA §6201, sub-§5, as amended by PL 1995, c. 368, Pt. CCC, §7 and affected by §11, is further amended to read:

5. Homestead. "Homestead" means the dwelling owned or rented by the claimant or held in a revocable living trust for the benefit of the claimant and occupied by the claimant and the claimant's dependents as a home, and may consist of a part of a multidwelling or multipurpose building and a part of the land , up to 10 acres, upon which it is built. "Owned" includes a vendee in possession under a land contract and of one or more joint tenants or tenants in common.

Sec. 2. 36 MRSA §6201, sub-§7, as enacted by PL 1987, c. 516, §§3 and 6, is amended to read:

7. Household income. "Household income" means all income received by all persons of a household in a calendar year while members of the household , excluding the income of members of the household for whom the claimant under this chapter is entitled to claim an exemption as a dependent under Part 8 for the year for which relief is requested.

Sec. 3. 36 MRSA §6201, sub-§9, as repealed and replaced by PL 2007, c. 438, §113, is amended to read:

9. Income. "Income" means Maine adjusted gross income determined in accordance with Part 8, modified as provided by this subsection.

A. Maine adjusted gross income must be increased by the following amounts, to the extent not included in Maine adjusted gross income:

(1) Contributions, including catch-up contributions, to any pension, annuity or retirement plan, including contributions to an individual retirement account under Section 408 of the Code, a simplified employee pension plan, a salary reduction simplified employee pension plan, a savings incentive match plan for employees plan and a deferred compensation plan under Section 457 of the Code and cash or deferred arrangements under Section 401 of the Code and qualified, or "Keogh," accounts;

(2) Nontaxable contributions to a flexible spending arrangement under Section 125 of the Code;

(3) Amounts excluded from gross income under Section 129 of the Code;

(4) Distributions from a ROTH IRA;

(5) Capital gains;

(6) The absolute value of the amount of trade or business loss, net operating loss carry-over, capital loss, rental loss, farm loss, partnership or S Corporation loss included in Maine adjusted gross income;

(7) Inheritance;

(8) Life insurance proceeds paid on death of an insured;

(9) Nontaxable lawsuit rewards resulting from lawsuits for actions such as slander, libel and pain and suffering, excluding reimbursements such as medical and legal expenses associated with the case;

(10) Support money;

(11) Nontaxable strike benefits;

(12) The gross amount of any pension or annuity, including railroad retirement benefits;

(13) All payments received under the federal Social Security Act and state unemployment insurance laws;

(14) Veterans' disability pensions;

(15) Nontaxable interest received from the Federal Government or any of its agencies or instrumentalities;

(16) Interest or dividends on obligations or securities of this State and its political subdivisions and authorities;

(17) Workers' compensation and the gross amount of "loss of time" insurance; and

(18) Cash public assistance and relief, but not including relief granted under this chapter . ; and

(19) The total nontaxable portion of the following items of income, determined as if a federal income tax return were required, but only if the total of all of the following income items exceeds $5,000:

(a) Jury duty payments;

(b) Awards;

(c) Lawsuit awards resulting from lawsuits for actions such as slander, libel and pain and suffering, excluding reimbursements such as medical and legal expenses associated with the case;

(d) Strike benefits; and

(e) Life insurance proceeds paid on death of an insured.

B. Maine adjusted gross income must be decreased by the following amounts, to the extent included in Maine adjusted gross income:

(1) The first $5,000 of proceeds from a life insurance policy, whether paid in a lump sum or in the form of an annuity;

(2) A rollover from an individual retirement account, pension or annuity fund or plan to an individual retirement account, pension or annuity fund or plan;

(3) Gifts from nongovernmental sources; and

(4) Surplus foods or other relief in kind supplied by a governmental agency.

Sec. 4. 36 MRSA §6203-A, as amended by PL 2009, c. 213, Pt. S, §14 and affected by §16, is repealed and the following enacted in its place:

§ 6203-A. Procedure for reimbursement

1. Application period beginning August 1, 2011. For the application period beginning August 1, 2011, at least monthly on or before the last day of the month, the State Tax Assessor shall determine the benefit for each claimant under this chapter and certify the amount to the State Controller to be transferred to the so-called circuit breaker reserve established, maintained and administered by the State Controller from General Fund undedicated revenue. At least monthly, the assessor shall pay the certified amounts to each approved applicant qualifying for the benefit under this chapter. Interest may not be allowed on any payment made to a claimant pursuant to this chapter.

2. Application periods beginning on or after January 1, 2012. For application periods beginning on or after January 1, 2012, the State Tax Assessor shall determine the benefit for each claimant under this chapter and certify the amount to the State Controller at any time after June 30th, but no later than July 15th, to be transferred to the so-called circuit breaker reserve established, maintained and administered by the State Controller from General Fund undedicated revenue. No later than August 1st, the assessor shall pay the certified amounts to each approved applicant qualifying for the benefit under this chapter. Interest may not be allowed on any payment made to a claimant pursuant to this chapter.

Sec. 5. 36 MRSA §6204, as amended by PL 2005, c. 2, Pt. E, §3 and affected by §§7 and 8, is repealed and the following enacted in its place:

§ 6204. Filing date

1. Application period beginning August 1, 2011. For the application period beginning August 1, 2011, a claim may not be paid unless the claim is filed with the bureau on or after August 1, 2011 and on or before December 31, 2011.

2. Application periods beginning on or after January 1, 2012. For application periods beginning on or after January 1, 2012, a claim may not be paid unless the claim is filed with the bureau on or after January 1st and on or before the following April 15th.

Sec. 6. 36 MRSA §6207, sub-§1, ¶A-1, as amended by PL 2009, c. 213, Pt. XXX, §1, is further amended to read:

A-1. Fifty percent of that portion of the benefit base that exceeds 4% but does not exceed 8% of income plus 100% of that portion of the benefit base that exceeds 8% of income to a maximum payment of $2,000; and calculated according to tables established by the State Tax Assessor.

(1) Tables established by the assessor must be based on the benefit formula set forth in this subsection and include benefit base brackets in increments of $100 and household income brackets in increments of $1,000.

(2) The maximum benefit under this subsection is limited to $2,400.

Sec. 7. 36 MRSA §6207, sub-§1, ¶B, as enacted by PL 2009, c. 213, Pt. XXX, §2, is repealed.

Sec. 8. 36 MRSA §6210, last ¶, as amended by PL 2005, c. 218, §59, is further amended to read:

The assessor shall include a checkoff to request an the application form and instructions for the Maine Residents Property Tax Program on with the individual income tax form. The assessor shall also provide for individuals to apply through the Department of Health and Human Services' integrated eligibility system as they apply or recertify for other programs administered by that department. The assessor shall also provide a paperless option for filing an application for the Maine Residents Property Tax Program.

Sec. 9. Report. By January 15, 2014, the State Tax Assessor shall submit a report to the joint standing committee of the Legislature having jurisdiction over taxation matters providing information comparing the annual cost of the Maine Residents Property Tax Program in years from 2005 to 2013, including the number of applicants for benefits under the Maine Residents Property Tax Program and the average benefits provided, and providing projections for the same information for 2014 to 2017. The report must identify the extent of increased participation in and benefit cost of the Maine Residents Property Tax Program as the result of coordination of the program with the income tax. The committee may submit legislation related to the report to the Second Regular Session of the 126th Legislature.

Sec. 10. Application. Unless otherwise specified and except for that section of this Act that amends the Maine Revised Statutes, Title 36, section 6210, this Act applies to applications filed with respect to program application periods of the Maine Residents Property Tax Program beginning on or after August 1, 2011. That section of this Act that amends Title 36, section 6210 applies to applications filed on or after January 1, 2012.

Emergency clause. In view of the emergency cited in the preamble, this legislation takes effect when approved.

SUMMARY

This bill simplifies the Maine Residents Property Tax Program, also referred to as "the Circuitbreaker Program," by simplifying the determination of eligibility, transitioning the application period to the income tax filing period and permitting application to be made through the Department of Health and Human Services' integrated eligibility system. The bill requires the State Tax Assessor to report to the joint standing committee of the Legislature having jurisdiction over taxation matters by January 15, 2014 on the impact of the changes made by this bill.

HP0367 LD 474	First Regular Session - 125th Maine Legislature		LR 1474 Item 1
	Bill Tracking, Additional Documents	Chamber Status

Bill Tracking		Chamber Status
Amendments	Testimony, Public Hearings & Work Sessions		Committee Information
Other Documents			Title & Section

Search Bill Text		Search Bill Status
Bill Directory	Session Information		Legislative Information
Download MS-Word, Printed PDF		Maine Legislature

Office of Legislative Information 100 State House Station Augusta, ME 04333		voice: (207) 287-1692 fax: (207) 287-1580 tty: (207) 287-6826
Word Viewer for Windows		Disclaimer