H.F. 2589 Section 1. Section 427.1, subsection 8, paragraph a, Code 1 2026, is amended to read as follows: 2 a. All grounds and buildings used or under construction by 3 literary, scientific, charitable, benevolent, agricultural, 4 and religious institutions and societies solely for their 5 appropriate objects, not exceeding three hundred twenty 6 acres in extent and not leased or otherwise used or under 7 construction with a view to pecuniary profit. However, 8 an organization mentioned in this subsection whose primary 9 objective is to preserve land in its natural state may own 10 or lease land not exceeding three hundred twenty acres in 11 each county for its appropriate objects. For assessment 12 years beginning on or after January 1, 2016, the exemption 13 granted by this subsection shall also apply to grounds owned 14 by a religious institution or society, not exceeding a total 15 of fifty acres, if all monetary and in-kind profits of the 16 religious institution or society resulting from use or lease of 17 the grounds are used exclusively by the religious institution 18 or society for the appropriate objects of the institution or 19 society. For assessment years beginning on or after January 20 1, 2027, a determination letter issued by the internal revenue 21 service recognizing exemption of a religious institution or 22 society under section 501(c)(3) of the Internal Revenue Code 23 shall be conclusive evidence of eligibility for exemption under 24 this subsection and such federal determination shall not be 25 modified by the local assessor. 26 Sec. 2. Section 427.1, subsection 14, unnumbered paragraph 27 1, Code 2026, is amended to read as follows: 28 A society or organization claiming an exemption under 29 subsection 5, 8, or 33 shall file with the assessor not 30 later than February 1 a statement upon forms to be prescribed 31 by the director of revenue, describing the nature of the 32 property upon which the exemption is claimed and setting out 33 in detail any uses and income from the property derived from 34 the rentals, leases, or other uses of the property not solely 35 -1- LSB 6674YH (2) 91 ms/md 1/ 3

H.F. 2589 for the appropriate objects of the society or organization. 1 In addition, for statements filed on or after July 1, 2026, 2 a religious institution or society may include a copy of the 3 determination letter issued by the internal revenue service 4 recognizing exemption of a religious institution or society 5 under section 501(c)(3) of the Internal Revenue Code. For 6 assessment years beginning on or after January 1, 2027, a 7 determination letter issued by the internal revenue service 8 recognizing exemption of a religious institution or society 9 under section 501(c)(3) of the Internal Revenue Code shall 10 be conclusive evidence of eligibility for exemption under 11 subsection 8 and such federal determination shall not be 12 modified by the local assessor. Upon the filing and allowance 13 of the claim, the claim shall be allowed on the property for 14 successive years without further filing as long as the property 15 is used for the purposes specified in the original claim for 16 exemption. When the property is sold or transferred, the 17 county recorder shall provide notice of the transfer to the 18 assessor. The notice shall describe the property transferred 19 and the name of the person to whom title to the property 20 is transferred. A claim that has been allowed on property 21 under subsection 8 shall be allowed after the transfer of the 22 property if the property continues to be used for the purposes 23 specified in the original claim for exemption. The county 24 recorder shall notify both the transferor and the transferee 25 before the termination of any exemption under subsection 8 26 and the filing requirements to continue the exemption on the 27 property transferred. 28 EXPLANATION 29 The inclusion of this explanation does not constitute agreement with 30 the explanation’s substance by the members of the general assembly. 31 Under current law, certain grounds used or under 32 construction by a religious institution or society are exempt 33 from property taxes. To claim such exemption, the religious 34 institution or society must file a statement describing the 35 -2- LSB 6674YH (2) 91 ms/md 2/ 3

H.F. 2589 nature of the property upon which the exemption is claimed and 1 setting out in detail any uses and income from the property 2 derived from the rentals, leases, or other uses of the property 3 not solely for the appropriate objects of the religious 4 institution or society. Once the claim has been allowed, and 5 the exemption is applied to the property, the claim is allowed 6 on the property for successive years without further filing 7 as long as the property is used for the purposes specified in 8 the original claim for exemption. When the property is sold 9 or transferred, the county recorder shall provide notice of 10 the transfer to the assessor. The notice shall describe the 11 property transferred and the name of the person to whom title 12 to the property is transferred. 13 This bill provides that for assessment years beginning on 14 or after January 1, 2027, a determination letter issued by the 15 internal revenue service recognizing exemption of a religious 16 institution or society under section 501(c)(3) of the Internal 17 Revenue Code shall be conclusive evidence of eligibility for 18 exemption of property taxes. A claim that has been allowed 19 on property of a religious institution or society shall be 20 allowed after the transfer of the property if the property 21 continues to be used for the purposes specified in the original 22 claim for exemption. The county recorder shall notify both 23 the transferor and the transferee before the termination of 24 any exemption of a religious institution or society and the 25 filing requirements to continue the exemption on the property 26 transferred. 27 -3- LSB 6674YH (2) 91 ms/md 3/ 3