AGENDA ITEM 12A
April S, 2016
Introduction
MEMORANDUM
April 1, 2016
TO:
FROM:
County Council
Amanda Mihill, Legislative
Attomeyt~
Jacob Sesker, Senior Legislative Analyst
~
"
SUBJECT:
Introduction:
Expedited Bill 10-16, Taxation - Residential Real Property Tax
Deferral Senior Citizens
Expedited Bill 10-16, Taxation Residential Real Property Tax Deferral - Senior Citizens,
sponsored by
Lead
Sponsors Vice President Berliner and Councilmembers Katz and Riemer and
Co-Sponsor Council President Floreen, is scheduled to be introduced on April S, 2016. A public
hearing is tentatively scheduled for April 26 at 1:30 p.m.
Expedited Bill 10-16 would provide for a residential real property
tax
deferral for residents at least
6S years old
with
a gross income of $80,000.
This packet contains:
Expedited Bill 10-16
Legislative Request Report
Circle #
1
S
F:\LAw\BILLS\161 0 Senior Tax Deferral\Intro Memo.Docx
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Expedited Bill No.
10-16
Concerning: Taxation - Residential Real
Property Tax Deferral - Senior
Citizens
Draft No.
Revised:
3/1012016
Introduced:
April 5, 2016
Expires:
October 5, 2017
Enacted: _ _ _ _ _ _ _ _ __
Executive: _ _ _ _ _ _ _ __
Effective: _ _ _ _ _ _ _ _ __
Sunset Date:
--!.:!N~onC!!:e"_
_ _ _ _ __
Ch. _ _, Laws of Mont Co. _ __
COUNTY COUNCIL
FOR MONTGOMERY COUNTY, MARYLAND
Lead
Sponsors: Vice President Berliner and Councilmembers
Katz
and Riemer
Co-Sponsor: Council President Floreen
AN EXPEDITED ACT
to:
(1) provide for a residential real property
tax
deferral for certain residents; and
(2) generally amend the County taxation law.
By amending
Montgomery COWlty Code
Chapter 52, Taxation
Section 52-18F
Boldface
Underlining
[Single boldface brackets]
Double underlining
[[Double boldface brackets]]
* * *
Heading or defined term.
Added to existing law by original bill.
Deletedfrom existing law by original bill.
Added by amendment.
Deletedfrom existing law or the bill by amendment.
Existing law uruifJected by hill.
The County Council for Montgomery County, Maryland approves the following Act:
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ExPEDITED BILL
No.
10-16
1
Sec. 1. Section 52-18F is amended as follows:
52-18F. Residential real property tax deferral[-General].
(a)
Definitions.
In this Section the following words have the meanings
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indicated:
Dependent
means f!dependentunder Section 152 ofthe Internal Revenue
Code.
[(1)
"Director"]
Director
means the Director of the Department of
Finance.
[(2)
"Legal interest"]
Legal interest
has the meaning stated in Section
9-104 ofthe Tax-Property Article ofthe Maryland Code.
[(3)
"Owner"]
Owner
means an individual who has a legal interest in
residential real property.
(b)
Authorization; Amount of Deferral.
An
owner may defer payment of
County property taxes due on residential real property occupied by the
owner as the owner's principal residence if the owner meets the
requirements of this Section. The amount of taxes that may be deferred
for anyone year is the amount that County taxes due exceeds the amount
of County property taxes paid in the prior taxable year.
(c)
Program Eligibility.
An
owner is eligible for a payment deferral under
this Section if:
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(1)
CA)
the gross mcome or combined gross income of all
individuals who actually reside in the dwelling (except a
dependent [under Section 152 of the Internal Revenue
Code] or a person who pays reasonable fixed charges for
rent or room and board), did not exceed $120,000 for the
calendar year that immediately precedes the taxable year for
which the deferral is sought; and
f:\law\bHls\1610 senior tax deferral\bill1.docx
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ExPEDITED Bill
No. 10-16
1
[(2)]
lID
the owner, or at least one ofthe owners, has resided in the
dwelling as that person's principal place of residence for 5
consecutive years and continues to occupy the property for
that
purpose[.]~
or
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ill
(A)
the owner is at least 65 years old; and
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ill)
the gross income or combined gross mcome of all
individuals who actually reside in the dwelling (except
!!
dependent or
!!
person who
P!!Y§
reasonable fixed charges
for rent or room and board), did not exceed $80,000 for the
calendar year that immediately precedes the taxable year for
which the deferral is sought.
F or purposes of income detennination under paragraph [(1)] (£), and to
the extent consistent with this Section, gross income or combined gross
income must be calculated in accordance with Section 9-104 ofthe Tax­
Property Article ofthe Maryland Code.
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*
(f)
Interest.
*
*
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[Interest] Except as provided in paragraph
m
interest accrues on
the deferred taxes at a rate set annually by the Director that does
not exceed the prime lending rate generally available on June 1 of
the preceding fiscal year.
The regulations adopted under
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subsection
(q)
must specify the source or sources that the Director
must use to calculate the prime rate generally available on June 1
of each year. The annual interest rate set by the Director applies
to any tax deferred that year, regardless of the year when the tax
was first deferred.
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ill
Notwithstanding paragraph
U1
for deferrals for owners
eligible
f;\law\bills\1610 senior tax deferral\bill 1.docx
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ExPEDITED BILL
No. 10-16
1
under paragraph (c)(2), the interest accrues on the deferred taxes
at
£!
rate of 0.0% or another amount set
Qy
Council resolution.
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*
(h)
*
*
Limits on Deforrals.
The accumulation of deferred taxes and accrued
interest must not exceed [50 percent] 50% of the full cash value of the
property, as determined by the Supervisor of Assessments, or a lesser
amount elected by the taxpayer and specified in the agreement required
under subsection
(1).
When the maximum amounts have been reached,
those amounts may continue to be deferred until any of the events
specified
in
subsection (k) occur.
An
owner who receives a tax deferral
under this Section must not also receive a
tax
deferral under Section
52-18C.
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*
Sec. 2.
*
*
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Expedited Effective Date.
The Council declares that this legislation is necessary for the immediate
protection of the public interest. This Act takes effect on July 1,2016.
Approved:
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Nancy
Floree~
President, County Council
Date
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Approved:
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Isiah Leggett, County Executive
Date
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This is a correct copy ofCouncil action
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Linda M. Lauer, Clerk ofthe Council
Date
f:\Iaw\bills\1610 senior
tax
deferral\bill1.docx
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LEGISLATIVE REQUEST REPORT
Expedited
Bill 10-16
Taxation
-
Residential Real Property Tax Deferral- Senior Citizens
DESCRIPTION:
Expedited
Bill 10-16
would provide for a residential real property tax
deferral for residents at least
65
years old with a gross income of
$80,000.
PROBLEM:
GOALS AND
OBJECTIVES:
COORDINATION:
FISCAL IMPACT:
ECONOMIC
IMPACT:
EVALUATION:
EXPERIENCE
ELSEWHERE:
SOURCE OF
INFORMATION:
APPLICATION
WITIDN
MUNICIP ALITIES:
PENALTIES:
Some individuals desire relief from the burden of increased property
taxes.
To alleviate the
tax
burden for certain eligible residents.
Department of Finance
To be requested.
To be requested.
To be requested.
To be researched.
Amanda MihiU,
240-777-7815
To
be
researched.
N/A
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