House File 2029 - Introduced HOUSE FILE 2029 BY KOESTER A BILL FOR An Act authorizing the military service property tax exemption 1 and credit to individuals on active duty, and including 2 effective date and applicability provisions. 3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 4 TLSB 5118YH (2) 87 md/jh

H.F. 2029 Section 1. Section 426A.11, Code 2018, is amended by adding 1 the following new subsection: 2 NEW SUBSECTION . 2A. The property, not to exceed one 3 thousand eight hundred fifty-two dollars in taxable value, of a 4 person on federal active duty or state active duty as defined 5 in section 29A.1. The exemption shall be allowed for each year 6 during which any portion of the person’s active duty service 7 occurs. 8 Sec. 2. Section 426A.12, subsection 1, unnumbered paragraph 9 1, Code 2018, is amended to read as follows: 10 In case any person in the foregoing classifications , 11 excluding those persons qualifying under section 426A.11, 12 subsection 2A, does not claim the exemption from taxation, it 13 shall be allowed in the name of the person to the same extent on 14 the property of any one of the following persons in the order 15 named: 16 Sec. 3. Section 426A.12, subsection 2, Code 2018, is amended 17 to read as follows: 18 2. No more than one tax exemption shall be allowed under 19 this section or section 426A.11 in the name of a veteran, 20 as defined in this chapter or in section 35.1, subsection 2 , 21 paragraph “a” or “b” , or in the name of a person qualifying for 22 the tax exemption under section 426A.11, subsection 2A . 23 Sec. 4. Section 426A.13, Code 2018, is amended to read as 24 follows: 25 426A.13 Claim for military tax exemption —— discharge 26 recorded. 27 1. A person named in section 426A.11 , who is a resident of 28 and domiciled in the state of Iowa, shall receive a reduction 29 equal to the exemption, to be made from any property owned 30 by the person or owned by a family farm corporation of which 31 the person is a shareholder and occupant of the property and 32 so designated by proceeding as provided in the section. To 33 be eligible to receive the exemption, the person claiming it 34 shall have recorded in the office of the county recorder of 35 -1- LSB 5118YH (2) 87 md/jh 1/ 5

H.F. 2029 the county in which is located the property designated for the 1 exemption, evidence of property ownership by that person or the 2 family farm corporation of which the person is a shareholder 3 and the military certificate of satisfactory service, order 4 transferring to inactive status, reserve, retirement, order of 5 separation from service, honorable discharge or a copy of any 6 of these documents of the person claiming or through whom is 7 claimed the exemption. In the case of a person claiming the 8 exemption as a veteran described in section 35.1, subsection 9 2 , paragraph “b” , subparagraph (6) or (7), the person shall 10 file the statement required by section 35.2 . In the case of a 11 person claiming the exemption under section 426A.11, subsection 12 2A, the person shall file a copy of the person’s active duty 13 orders establishing the person’s qualifications. 14 2. The person shall file with the appropriate assessor on 15 forms obtained from the assessor the claim for exemption for 16 the year for which the person is first claiming the exemption. 17 The claim shall be filed not later than July 1 of the year 18 for which the person is claiming the exemption. The claim 19 shall set out the fact that the person is a resident of and 20 domiciled in the state of Iowa, and a person within the terms 21 of section 426A.11 , and shall give the volume and page on which 22 the certificate of satisfactory service, order of separation, 23 retirement, furlough to reserve, inactive status, or honorable 24 discharge or certified copy thereof is recorded in the office 25 of the county recorder, and may include the designation of the 26 property from which the exemption is to be made, and shall 27 further state that the claimant is the equitable or legal owner 28 of the property designated or if the property is owned by a 29 family farm corporation, that the person is a shareholder of 30 that corporation and that the person occupies the property. 31 In the case of a person claiming the exemption as a veteran 32 described in section 35.1, subsection 2 , paragraph “b” , 33 subparagraph (6) or (7), the person shall file the statement 34 required by section 35.2 . In the case of a person claiming 35 -2- LSB 5118YH (2) 87 md/jh 2/ 5

H.F. 2029 the exemption under section 426A.11, subsection 2A, the 1 person shall file a copy of the person’s active duty orders 2 establishing the person’s qualifications. 3 3. Upon the filing and allowance of the claim, the claim 4 shall be allowed to that person for successive years without 5 further filing , subject to the period of active duty if 6 claimed under section 426A.11, subsection 2A . Provided, 7 that notwithstanding the filing or having on file a claim 8 for exemption, the person or person’s spouse is the legal or 9 equitable owner of the property on July 1 of the year for which 10 the claim is allowed. When the property is sold or transferred 11 or the person wishes to designate different property for the 12 exemption, a person who wishes to receive the exemption shall 13 refile for the exemption. A person who sells or transfers 14 property which is designated for the exemption or the personal 15 representative of a deceased person who owned such property 16 shall provide written notice to the assessor that the property 17 is no longer legally or equitably owned by the former claimant. 18 4. In case the owner of the property is in active duty 19 service in any of the armed forces of the United States or of 20 this state, including the nurses corps of the state or of the 21 United States, or is sixty-five years of age or older, or is 22 disabled, the claim may be filed by any member of the owner’s 23 family, by the owner’s guardian or conservator, or by any other 24 person who may represent the owner under power of attorney. 25 In all cases where the owner of the property is married, the 26 spouse may file the claim for exemption. A person may not 27 claim an exemption in more than one county of the state, and 28 if a designation is not made the exemption shall apply to the 29 homestead, if any. 30 Sec. 5. EMERGENCY RULES. The department of revenue may 31 adopt emergency rules under section 17A.4, subsection 3, and 32 section 17A.5, subsection 2, paragraph “b”, to implement 33 the provisions of this Act and the rules shall be effective 34 immediately upon filing unless a later date is specified in the 35 -3- LSB 5118YH (2) 87 md/jh 3/ 5

H.F. 2029 rules. Any rules adopted in accordance with this section shall 1 also be published as a notice of intended action as provided 2 in section 17A.4. 3 Sec. 6. EFFECTIVE DATE. This Act, being deemed of immediate 4 importance, takes effect upon enactment. 5 Sec. 7. APPLICABILITY. This Act applies to property taxes 6 due and payable in fiscal years beginning on or after July 1, 7 2019. 8 EXPLANATION 9 The inclusion of this explanation does not constitute agreement with 10 the explanation’s substance by the members of the general assembly. 11 Current Code chapter 426A authorizes a military service 12 property tax exemption and credit for qualifying veterans 13 who are residents of and domiciled in this state or, under 14 specified circumstances, members of such a veteran’s family. 15 The exemption amount for World War I veterans is $2,778 in 16 taxable value. The exemption for all other qualifying veterans 17 is $1,852 in taxable value. 18 This bill provides a similar property tax exemption for 19 persons who are on active federal duty or active state duty on 20 $1,852 in taxable value. The bill authorizes the exemption 21 for each year during which any portion of the person’s active 22 duty service occurs. The bill also requires the applicant to 23 file a copy of the person’s active duty orders as part of the 24 application for the exemption. 25 The bill authorizes the department of revenue to adopt 26 emergency rules under Code chapter 17A to implement the 27 provisions of the bill. 28 Code section 25B.7 generally provides that if a state 29 appropriation made to fund a property tax credit or exemption 30 is not sufficient to fully fund the credit or exemption, 31 the political subdivision shall be required to extend to 32 the taxpayer only that portion of the credit or exemption 33 estimated by the department of revenue to be funded by the 34 state appropriation. For purposes of the military service 35 -4- LSB 5118YH (2) 87 md/jh 4/ 5

H.F. 2029 property tax exemption and credit, however, the requirement 1 for fully funding and the consequence of not fully funding the 2 credit applies to the military service property tax exemption 3 and credit up to $6.92 per $1,000 of assessed value of the 4 exempt property. 5 The bill takes effect upon enactment and applies to property 6 taxes due and payable in fiscal years beginning on or after 7 July 1, 2019. 8 -5- LSB 5118YH (2) 87 md/jh 5/ 5