Bill Text: MI HB4111 | 2017-2018 | 99th 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 1-0)

Status: (Introduced - Dead) 2017-01-31 - Bill Electronically Reproduced 01/26/2017 [HB4111 Detail]

Download: Michigan-2017-HB4111-Introduced.html

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HOUSE BILL No. 4111

 

 

January 26, 2017, Introduced by Reps. Yanez, Elder, Robinson, Lucido, Green, Ellison, Chirkun, Wittenberg, Hoadley, Sowerby and Pagan 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 2015 PA 179.

 

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 equal

 

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

 

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

 

 7  3.5% of the claimant's total household resources for tax years

 

 8  before the 2018 tax year or 3.2% of the claimant's total household

 

 9  resources for the 2018 tax year and each tax year after 2018.

 

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

 

11  against the state income tax liability under this part equal to the

 1  following:

 

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

 

 3  $21,000.00 or less, an amount as determined in accordance with

 

 4  subdivision (c).

 

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

 

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

 

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

 

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

 

 9  year and 3.5% of total household resources for tax years before the

 

10  2018 tax year or 3.2% of total household resources for the 2018 tax

 

11  year and each tax year after 2018.

 

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

 

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

 

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

 

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

 

16  year and 3.5% of total household resources for tax years before the

 

17  2018 tax year or 3.2% of total household resources for the 2018 tax

 

18  year and each tax year after 2018.

 

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

 

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

 

21  equal to 88% 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 for tax years before the

 

24  2018 tax year or 3.2% of total household resources for the 2018 tax

 

25  year and each tax year after 2018.

 

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

 

27  $24,000.00 and less than or equal to $25,000.00, an amount equal to

 1  84% of the difference between the property taxes on the homestead

 

 2  or the credit for rental of the homestead for the tax year and 3.5%

 

 3  of total household resources for tax years before the 2018 tax year

 

 4  or 3.2% of total household resources for the 2018 tax year and each

 

 5  tax year after 2018.

 

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

 

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

 

 8  equal to 80% 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 for tax years before the

 

11  2018 tax year or 3.2% of total household resources for the 2018 tax

 

12  year and each tax year after 2018.

 

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

 

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

 

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

 

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

 

17  year and 3.5% of total household resources for tax years before the

 

18  2018 tax year or 3.2% of total household resources for the 2018 tax

 

19  year and each tax year after 2018.

 

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

 

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

 

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

 

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

 

24  year and 3.5% of total household resources for tax years before the

 

25  2018 tax year or 3.2% of total household resources for the 2018 tax

 

26  year and each tax year after 2018.

 

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

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

 

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

 

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

 

 4  year and 3.5% of total household resources for tax years before the

 

 5  2018 tax year or 3.2% of total household resources for the 2018 tax

 

 6  year and each tax year after 2018.

 

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

 

 8  $29,000.00 and less than or equal to $30,000.00, an amount equal to

 

 9  64% of the difference between the property taxes on the homestead

 

10  or the credit for rental of the homestead for the tax year and 3.5%

 

11  of total household resources for tax years before the 2018 tax year

 

12  or 3.2% of total household resources for the 2018 tax year and each

 

13  tax year after 2018.

 

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

 

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

 

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

 

17  homestead for the tax year and 3.5% of total household resources

 

18  for tax years before the 2018 tax year or 3.2% of total household

 

19  resources for the 2018 tax year and each tax year after 2018.

 

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

 

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

 

22  quadriplegic and for tax years that begin after December 31, 1999,

 

23  a claimant who is totally and permanently disabled, deaf, or, for

 

24  tax years that begin after December 31, 2012, blind is entitled to

 

25  a credit against the state income tax liability for the amount by

 

26  which the property taxes on the homestead, the credit for rental of

 

27  the homestead, or a service charge in lieu of ad valorem taxes as

 1  provided by section 15a of the state housing development authority

 

 2  act of 1966, 1966 PA 346, MCL 125.1415a, for the tax year exceeds

 

 3  the percentage of the claimant's total household resources for that

 

 4  tax year computed as follows:

 

 

5	Total household resources                      Percentage
6	Not over $3,000.00                                 .0%
7	Over $3,000.00 but not over $4,000.00             1.0%
8	Over $4,000.00 but not over $5,000.00             2.0%
9	Over $5,000.00 but not over $6,000.00             3.0%
10	Over $6,000.00 for tax years before
11	the 2018 tax year                                 3.5%
12	Over $6,000.00 for tax years after
13	the 2017 tax year                                 3.2%

 

 

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

 

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

 

16  eligible widow or widower is entitled to a credit against the state

 

17  income tax liability for a percentage of the property taxes on the

 

18  homestead for the tax year not in excess of 100% determined as

 

19  follows:

 

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

 

21  506 by the taxable value of the homestead or, if the eligible

 

22  serviceperson, eligible veteran, or eligible widow or widower

 

23  leases or rents a homestead, divide 20% of the total annual rent

 

24  paid for tax years before the 2018 tax year or 23% of the total

 

25  annual rent paid for tax years after the 2017 tax year on the

 

26  property by the property tax rate on the property.

 

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

 

 2  percentage computed in subparagraph (i).

 

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

 

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

 

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

 

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

 

 7  less, 100% of the property taxes.

 

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

 

 9  $3,500.00, the percentage that $3,500.00 bears to the taxable value

 

10  of the homestead.

 

11        (f) For the 2017 tax year and each tax year thereafter, a

 

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

 

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

 

14  receives compensation paid by the veterans administration or the

 

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

 

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

 

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

 

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

 

19  that homestead for the tax year, regardless of the type of

 

20  homestead that is being leased or rented.

 

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

 

22  1 classification shall elect the classification under which the

 

23  claim is made.

 

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

 

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

 

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

 

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

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

 

 2  the social security act, 42 USC 416.

 

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

 

 4  tax year of $6,000.00 or less and who for 1973 received a senior

 

 5  citizen homestead exemption under former section 7c of the general

 

 6  property tax act, 1893 PA 206, may compute the credit against the

 

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

 

 8  on the homestead for the tax year determined as follows:

 

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

 

10  less, 100% of the property taxes.

 

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

 

12  $2,500.00, the percentage that $2,500.00 bears to the taxable value

 

13  of the homestead.

 

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

 

15  reduced proportionately.

 

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

 

17  determine the amount of the claim.

 

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

 

19  shall not exceed the amount determined under section 520.

 

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

 

21  the natural resources and environmental protection act, 1994 PA

 

22  451, MCL 324.36101 to 324.36117, shall not exceed the total

 

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

 

24  amount by which the credit exceeds the property tax due and payable

 

25  shall be deducted from the credit claimed under part 361 of the

 

26  natural resources and environmental protection act, 1994 PA 451,

 

27  MCL 324.36101 to 324.36117.