Bill Text: MI HB5278 | 2013-2014 | 97th Legislature | Introduced

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Bill Title: Individual income tax; veterans; property tax credit; increase for certain qualified veterans. Amends sec. 522 of 1967 PA 281 (MCL 206.522).

Spectrum: Partisan Bill (Democrat 11-0)

Status: (Introduced - Dead) 2014-12-03 - Referred To Second Reading [HB5278 Detail]

Download: Michigan-2013-HB5278-Introduced.html

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HOUSE BILL No. 5278

February 4, 2014, Introduced by Reps. Yanez, Hovey-Wright, Slavens, Zemke, Faris, Phelps, Lamonte, Roberts, LaVoy, Cavanagh and Tlaib and referred to the Committee on Tax Policy.

 

      A bill to amend 1967 PA 281, entitled

 

"Income tax act of 1967,"

 

by amending section 522 (MCL 206.522), as amended by 2013 PA 206.

 

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 

 1        Sec. 522. (1) The amount of a claim made pursuant to this

 

 2  chapter shall be determined as follows:

 

 3        (a) A claimant who is not a senior citizen is entitled to a

 

 4  credit against the state income tax liability under this part

 

 5  equal to 60% of the amount by which the property taxes on the

 

 6  homestead, or the credit for rental of the homestead for the tax

 

 7  year, exceeds 3.5% of the claimant's total household resources

 

 8  for that tax year.

 

 9        (b) A claimant who is a senior citizen is entitled to a

 

 1  credit against the state income tax liability under this part

 

 2  equal to the following:

 

 3        (i) For a claimant with total household resources of

 

 4  $21,000.00 or less, an amount as determined in accordance with

 

 5  subdivision (c).

 

 6        (ii) For a claimant with total household resources of more

 

 7  than $21,000.00 and less than or equal to $22,000.00, an amount

 

 8  equal to 96% of the difference between the property taxes on the

 

 9  homestead or the credit for rental of the homestead for the tax

 

10  year and 3.5% of total household resources.

 

11        (iii) For a claimant with total household resources of more

 

12  than $22,000.00 and less than or equal to $23,000.00, an amount

 

13  equal to 92% of the difference between the property taxes on the

 

14  homestead or the credit for rental of the homestead for the tax

 

15  year and 3.5% of total household resources.

 

16        (iv) For a claimant with total household resources of more

 

17  than $23,000.00 and less than or equal to $24,000.00, an amount

 

18  equal to 88% of the difference between the property taxes on the

 

19  homestead or the credit for rental of the homestead for the tax

 

20  year and 3.5% of total household resources.

 

21        (v) For a claimant with total household resources of more

 

22  than $24,000.00 and less than or equal to $25,000.00, an amount

 

23  equal to 84% of the difference between the property taxes on the

 

24  homestead or the credit for rental of the homestead for the tax

 

25  year and 3.5% of total household resources.

 

26        (vi) For a claimant with total household resources of more

 

27  than $25,000.00 and less than or equal to $26,000.00, an amount

 

 1  equal to 80% of the difference between the property taxes on the

 

 2  homestead or the credit for rental of the homestead for the tax

 

 3  year and 3.5% of total household resources.

 

 4        (vii) For a claimant with total household resources of more

 

 5  than $26,000.00 and less than or equal to $27,000.00, an amount

 

 6  equal to 76% of the difference between the property taxes on the

 

 7  homestead or the credit for rental of the homestead for the tax

 

 8  year and 3.5% of total household resources.

 

 9        (viii) For a claimant with total household resources of more

 

10  than $27,000.00 and less than or equal to $28,000.00, an amount

 

11  equal to 72% of the difference between the property taxes on the

 

12  homestead or the credit for rental of the homestead for the tax

 

13  year and 3.5% of total household resources.

 

14        (ix) For a claimant with total household resources of more

 

15  than $28,000.00 and less than or equal to $29,000.00, an amount

 

16  equal to 68% of the difference between the property taxes on the

 

17  homestead or the credit for rental of the homestead for the tax

 

18  year and 3.5% of total household resources.

 

19        (x) For a claimant with total household resources of more

 

20  than $29,000.00 and less than or equal to $30,000.00, an amount

 

21  equal to 64% of the difference between the property taxes on the

 

22  homestead or the credit for rental of the homestead for the tax

 

23  year and 3.5% of total household resources.

 

24        (xi) For a claimant with total household resources of more

 

25  than $30,000.00, an amount equal to 60% of the difference between

 

26  the property taxes on the homestead or the credit for rental of

 

27  the homestead for the tax year and 3.5% of total household

 

 1  resources.

 

 2        (c) A claimant who is a senior citizen with total household

 

 3  resources of $21,000.00 or less or a paraplegic, hemiplegic, or

 

 4  quadriplegic and for tax years that begin after December 31,

 

 5  1999, a claimant who is totally and permanently disabled, deaf,

 

 6  or, for tax years that begin after December 31, 2012, blind is

 

 7  entitled to a credit against the state income tax liability for

 

 8  the amount by which the property taxes on the homestead, the

 

 9  credit for rental of the homestead, or a service charge in lieu

 

10  of ad valorem taxes as provided by section 15a of the state

 

11  housing development authority act of 1966, 1966 PA 346, MCL

 

12  125.1415a, for the tax year exceeds the percentage of the

 

13  claimant's total household resources for that tax year computed

 

14  as follows:

 

 

15      Total household resources                      Percentage

16      Not over $3,000.00                                 .0%

17      Over $3,000.00 but not over $4,000.00             1.0%

18      Over $4,000.00 but not over $5,000.00             2.0%

19      Over $5,000.00 but not over $6,000.00             3.0%

20      Over $6,000.00                                    3.5%

 

 

21        (d) A Except as otherwise provided under subdivision (f), a

 

22  claimant who is an eligible serviceperson, eligible veteran, or

 

23  eligible widow or widower is entitled to a credit against the

 

24  state income tax liability for a percentage of the property taxes

 

25  on the homestead for the tax year not in excess of 100%

 

26  determined as follows:

 

 1        (i) Divide the taxable value allowance specified in section

 

 2  506 by the taxable value of the homestead or, if the eligible

 

 3  serviceperson, eligible veteran, or eligible widow or widower

 

 4  leases or rents a homestead, divide 17% of the total annual rent

 

 5  paid for tax years before the 1994 tax year, or 20% of the total

 

 6  annual rent paid for tax years after the 1993 tax year on the

 

 7  property by the property tax rate on the property.

 

 8        (ii) Multiply the property taxes on the homestead by the

 

 9  percentage computed in subparagraph (i).

 

10        (e) A claimant who is blind is entitled to a credit against

 

11  the state income tax liability for a percentage of the property

 

12  taxes on the homestead for the tax year determined as follows:

 

13        (i) If the taxable value of the homestead is $3,500.00 or

 

14  less, 100% of the property taxes.

 

15        (ii) If the taxable value of the homestead is more than

 

16  $3,500.00, the percentage that $3,500.00 bears to the taxable

 

17  value of the homestead.

 

18        (f) For the 2014 tax year and each tax year thereafter, a

 

19  claimant who is an eligible serviceperson, eligible veteran, or

 

20  eligible widow or widower who leases or rents a homestead and who

 

21  receives compensation paid by the veterans administration or the

 

22  armed forces of the United States at the 100% disability rate for

 

23  service-incurred disabilities is entitled to a credit against the

 

24  state income tax liability under this part equal to 20% of the

 

25  total annual rent paid, not to exceed 100% of the property taxes

 

26  on that homestead for the tax year, regardless of the type of

 

27  homestead that is being leased or rented.

 

 1        (2) A person who is qualified to make a claim under more

 

 2  than 1 classification shall elect the classification under which

 

 3  the claim is made.

 

 4        (3) Only 1 claimant per household for a tax year is entitled

 

 5  to the credit, unless both the husband and wife filing a joint

 

 6  return are blind, then each shall be considered a claimant.

 

 7        (4) As used in this section, "totally and permanently

 

 8  disabled" means disability as defined in section 216 of title II

 

 9  of the social security act, 42 USC 416.

 

10        (5) A senior citizen who has total household resources for

 

11  the tax year of $6,000.00 or less and who for 1973 received a

 

12  senior citizen homestead exemption under former section 7c of the

 

13  general property tax act, 1893 PA 206, may compute the credit

 

14  against the state income tax liability for a percentage of the

 

15  property taxes on the homestead for the tax year determined as

 

16  follows:

 

17        (a) If the taxable value of the homestead is $2,500.00 or

 

18  less, 100% of the property taxes.

 

19        (b) If the taxable value of the homestead is more than

 

20  $2,500.00, the percentage that $2,500.00 bears to the taxable

 

21  value of the homestead.

 

22        (6) For a return of less than 12 months, the claim shall be

 

23  reduced proportionately.

 

24        (7) The department may prescribe tables that may be used to

 

25  determine the amount of the claim.

 

26        (8) The total credit allowed in this section for each year

 

27  after December 31, 1975 shall not exceed $1,200.00 per year.

 

 1        (9) The total credit allowable under this part and part 361

 

 2  of the natural resources and environmental protection act, 1994

 

 3  PA 451, MCL 324.36101 to 324.36117, shall not exceed the total

 

 4  property tax due and payable by the claimant in that year. The

 

 5  amount by which the credit exceeds the property tax due and

 

 6  payable shall be deducted from the credit claimed under part 361

 

 7  of the natural resources and environmental protection act, 1994

 

 8  PA 451, MCL 324.36101 to 324.36117.