SF 2223 (LSB 5864XS (3) 85)

SENATE FILE 2223

BY  ANDERSON

A BILL FOR

An Act relating to the additional homestead property tax credit for disabled veterans and including applicability date provisions.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.  Section 425.15, Code 2014, is amended to read as follows:
   425.15  Disabled veteran tax credit.

   If the owner of a homestead allowed a credit under this chapter is a veteran of any of the military forces of the United States, who acquired the homestead under 38 U.S.C. § 21.801, 21.802, prior to August 6, 1991, or 38 U.S.C. § 2101, through 2102, or a veteran as defined in section 35.1, with a service-connected disability, as certified by the United States department of veterans affairs, the amount of the credit allowed on the homestead from the homestead credit fund shall be the entire amount a percentage of the tax levied on the homestead, after subtracting the regular homestead credit allowed under section 425.1, that is equivalent to the veteran’s service-connected disability rating percentage. The credit allowed shall be continued to the estate of a veteran who is deceased or the surviving spouse and any child, as defined in section 234.1, who are the beneficiaries of a deceased veteran, so long as the surviving spouse remains unmarried. This section is not applicable to the holder of title to any homestead whose annual income, together with that of the titleholder’s spouse, if any, for the last preceding twelve-month income tax accounting period exceeds thirty-five thousand dollars. For the purpose of this section “income” means taxable income for federal income tax purposes plus income from securities of state and other political subdivisions exempt from federal income tax. A veteran or a beneficiary of a veteran who elects to secure the credit provided in this section is not eligible for any other real property tax exemption provided by law for veterans of military service.  If a veteran’s service-connected disability rating percentage changes, the veteran shall provide written notice to the assessor by July 1 following the date on which the rating percentage is changed. If a veteran acquires a different homestead, the credit allowed under this section may be claimed on the new homestead unless the veteran fails to meet the other requirements of this section.
    Sec. 2.  APPLICABILITY.  This Act applies to property taxes due and payable in fiscal years beginning on or after July 1, 2015.
EXPLANATION
The inclusion of this explanation does not constitute agreement with

the explanation’s substance by the members of the general assembly.
   The disabled veterans tax credit under Code section 425.15 provides a property tax credit equal to the entire amount of the tax levied on the homestead of a veteran who acquired the homestead under specified federal programs, and who has an income of $35,000 or less.
   This bill provides that in addition to those veterans who acquired their homestead under a specified government program, the credit is also allowed for a veteran, as defined in Code section 35.1, who has a service-connected disability as certified by the United States department of veterans affairs. The credit allowed on the homestead is an amount equal to a percentage of the amount of the tax levied on the homestead that is equivalent to the veteran’s permanent service-connected disability rating percentage.
   The bill also strikes the income limitation qualifications for the disabled veteran tax credit and strikes a provision making the veteran receiving this credit ineligible for any other property tax exemption.
   Code section 25B.7 provides that if a state appropriation made to fund the credit or exemption is not sufficient to fully fund the credit or exemption, the political subdivision shall be required to extend to the taxpayer only that portion of the credit or exemption estimated by the department of revenue to be funded by the state appropriation.
   The bill applies to property taxes due and payable in fiscal years beginning on or after July 1, 2015.