SSB 1034 (LSB 1628XC (2) 89)

SENATE FILE _____ 

BY  (PROPOSED COMMITTEE ON LABOR AND BUSINESS RELATIONS BILL BY CHAIRPERSON WHITING)

A BILL FOR

An Act establishing a new resident homestead rebate for certain individuals relocating to the state, establishing a new resident homestead rebate fund, and making appropriations.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.  NEW SECTION.  425B.1  New resident homestead rebate program.
   Persons who own their homesteads and who meet the qualifications provided in this chapter are eligible for a new resident homestead rebate.
    Sec. 2.  NEW SECTION.  425B.2  Definitions.
   As used in this chapter, unless the context otherwise requires:
   1.  “Base year” means the calendar year last ending before the claim is filed.
   2.  “Claimant” means a person filing a claim for a rebate under this chapter who resided outside of the state prior to filing the claim, who moved to and established a homestead in this state on or after January 1, 2021, but before the end of the base year, and who was employed in this state for an average of twenty hours per week during the base year, or during that portion of the year during which the person lived in this state, or is the spouse of a person in the same household who was employed in this state for an average of twenty hours per week during the base year, or during that portion of the year during which the person lived in this state.
   3.  “Homestead” means the same as defined in section 425.11.
   4.  “Household” means the same as defined in section 425.17.
   5.  “Property taxes paid” means property taxes actually paid by the claimant excluding any property tax credit on the homestead and any special assessments certified pursuant to chapter 384, subchapter IV, and exclusive of delinquent interest and charges for services, due on a claimant’s homestead in this state, but includes only property taxes for which the claimant is liable.
    Sec. 3.  NEW SECTION.  425B.3  Claiming rebate.
   1.  The right to file a claim for a new resident homestead rebate under this chapter may be exercised by the claimant or on behalf of a claimant by the claimant’s legal guardian, spouse, or attorney, or by the executor or administrator of the claimant’s estate. If a claimant dies after having filed a claim for a rebate, the amount of the rebate may be paid to another member of the household as determined by the department of revenue. If the claimant was the only member of the household, the rebate may be paid to the claimant’s executor or administrator, but if neither is appointed and qualified within one year from the date of the filing of the claim, the rebate shall escheat to the state.
   2.  a.  Only one claimant per household per year shall be entitled to a rebate under this chapter. Subject to the limitations in paragraph “b”, a claimant may annually claim a rebate for a portion of the property taxes paid on the homestead during the base year. A claimant may only establish residency once for purposes of eligibility for the rebate under this chapter. The director of revenue shall make available suitable forms with instructions for claimants. The claim shall be in a form as the director may prescribe.
   b.  The rebate authorized under this chapter shall be available to a claimant for the five consecutive years following the year the claimant established residency in this state if the homestead and employment requirements are met during each base year. The amount of the rebate is equal to a percent of the property taxes paid, determined as follows:
   (1)  For the first year, twenty percent.
   (2)  For the second year, forty percent.
   (3)  For the third year, sixty percent.
   (4)  For the fourth year, eighty percent.
   (5)  For the fifth year, one hundred percent.
   3.  A claim for a rebate shall not be paid or allowed unless the claim is filed with the department of revenue between January 1 and March 1, both dates inclusive, immediately following the base year during which the property taxes were paid. However, in case of sickness, absence, or other disability of the claimant, or if in the judgment of the director of revenue good cause exists, the director of revenue may extend the time for filing a claim for rebate through June 30 of the same calendar year. A claim for rebate shall be disallowed if the department finds that the claimant or a person of the claimant’s household received title to the homestead primarily for the purpose of receiving benefits under this chapter.
   4.  The amount of any rebate payable under this chapter may be applied by the department of revenue against any tax liability, delinquent accounts, charges, loans, fees, or other indebtedness due the state or state agency that has a formal agreement with the department of revenue for central debt collection, outstanding on the books of the department against the claimant, or against a spouse who was a member of the claimant’s household in the base year.
    Sec. 4.  NEW SECTION.  425B.4  Proof of claim.
   1.  Every claimant shall give the department of revenue, in support of the claim, reasonable proof of:
   a.  Date of establishing residency in this state.
   b.  Ownership of the property claimed as homestead or changes in homestead.
   c.  Property taxes paid during base year.
   d.  Household membership.
   e.  Employment hours during base year.
   2.  The department may require any additional proof necessary to support a claim.
    Sec. 5.  NEW SECTION.  425B.5  Audit —— recalculation or denial —— appeals.
   If on the audit of a claim for rebate under this chapter, the department of revenue determines the amount of the claim to have been incorrectly calculated or that the claim is not allowable, the department shall recalculate the claim and notify the claimant of the recalculation or denial and the reasons for it. The recalculation of the claim shall be final unless appealed to the director within thirty days from the date of notice of recalculation or denial. The director shall grant a hearing, and upon hearing, determine the correct claim, if any, and notify the claimant of the decision by mail. The department of revenue shall not adjust a claim after three years from October 31 of the year in which the claim was filed. If the rebate has been paid, the amount may be recovered by assessment in the same manner that income taxes are assessed under sections 422.26 and 422.30. The decision of the director shall be final unless appealed as provided in section 425B.7, subsection 2. Section 422.70 applies with respect to this chapter.
    Sec. 6.  NEW SECTION.  425B.6  False claim —— penalty.
   A person who makes a false affidavit for the purpose of obtaining the rebate provided for in this chapter or who knowingly receives the rebate without being legally entitled to it is guilty of a fraudulent practice. The claim for rebate shall be disallowed in full and if the rebate has been paid, the amount shall be recovered in the manner provided in section 425B.5. The department of revenue may impose penalties under section 421.27. The department of revenue shall send a notice of disallowance of the claim.
    Sec. 7.  NEW SECTION.  425B.7  Notices, appeals, and rules.
   1.  Section 423.39, subsection 1, shall apply to all notices under this chapter.
   2.  Any person aggrieved by an act or decision of the director of revenue or the department of revenue under this chapter shall have the same rights of appeal and review as provided in section 423.38 and the rules of the department of revenue.
   3.  The director of revenue shall adopt rules in accordance with chapter 17A for the interpretation and proper administration of this chapter, including rules to prevent and disallow duplication of benefits and to prevent any unreasonable hardship or advantage to any person.
    Sec. 8.  NEW SECTION.  425B.8  Fund created —— appropriation.
   The new resident homestead rebate fund is created. There is appropriated annually from the general fund of the state to the department of revenue to be credited to the new resident homestead rebate fund, from funds not otherwise appropriated, an amount sufficient to implement this chapter and make payments for all rebates claimed.
EXPLANATION
The inclusion of this explanation does not constitute agreement with
the explanation’s substance by the members of the general assembly.
   This bill establishes a new resident homestead rebate for certain individuals who relocate to the state, maintain a homestead, and meet certain employment requirements. A person who moved to and established a homestead in this state on or after January 1, 2021, but before the end of the base year, as defined in the bill, and who was employed in this state for an average of 20 hours per week during the base year, or during that portion of the year during which the person lived in this state, or is the spouse of a person in the same household who satisfies this employment requirement, is eligible for the rebate. The criteria for determining a “homestead” is the same as is required for the homestead property tax credit under Code chapter 425.
   Only one claimant per household per year is entitled to a rebate under the bill. Additionally, a claimant may only establish residency once for purposes of eligibility for the rebate under the bill. A claimant may annually claim a rebate for a portion of the property taxes paid on the homestead during the base year. “Property taxes paid” is defined in the bill to be property taxes actually paid by the claimant excluding any property tax credit on the homestead and any special assessments certified pursuant to Code chapter 384, subchapter IV, and exclusive of delinquent interest and charges for services, due on a claimant’s homestead in this state, but includes only property taxes for which the claimant is liable.
   The rebate authorized in the bill is available to a claimant for the five consecutive years following the establishment of residency in this state if the homestead and employment requirements are met during each base year. The amount of the rebate is equal to a percent of the property taxes paid, determined as follows: for the first year, 20 percent; for the second year, 40 percent; for the third year, 60 percent; for the fourth year, 80 percent; and for the fifth year, 100 percent.
   A claim for a rebate shall not be paid or allowed unless the claim is filed with the department of revenue between January 1 and March 1, both dates inclusive, immediately following the base year during which the property taxes were paid. The bill authorizes the amount of any rebate to be applied by the department of revenue against any tax liability, delinquent accounts, charges, loans, fees, or other indebtedness due the state or state agency that has a formal agreement with the department of revenue for central debt collection, outstanding on the books of the department against the claimant, or against a spouse who was a member of the claimant’s household in the base year. 
   The bill establishes provisions relating to the audit of rebate claims and the collection of improperly paid rebates. A person who makes a false affidavit for the purpose of obtaining the rebate or who knowingly receives the rebate without being legally entitled to it is guilty of a fraudulent practice.
   The bill establishes a new resident homestead rebate fund. The bill appropriates annually from the general fund of the state to the department of revenue to be credited to the new resident homestead rebate fund an amount sufficient to implement the program and make payments for all rebates claimed.