New Jersey-2014-A400-Introduced

An Act allowing gross income tax refunds to be credited against a taxpayer's delinquent local property taxes, amending section 1 of P.L.1981, c.239 (C.54A:9-8.1) and section 8 of P.L.1990, c.61 (C.54:4-8.64).

Be It Enacted by the Senate and General Assembly of the State of New Jersey:

1. Section 1 of P.L.1981, c.239 (C.54A:9-8.1) is amended to read as follows:

1. a. Whenever any taxpayer or resident shall be entitled to any refund of taxes pursuant to the "New Jersey Gross Income Tax Act" (N.J.S.54A:1-1 et seq.), including an earned income tax credit provided as a refund pursuant to P.L.2000, c.80 (C.54A:4-6 et al.), or whenever any individual is eligible to receive a homestead rebate or credit pursuant to P.L.1990, c.61 (C.54:4-8.57 et al.), P.L.1999, c.63 (C.54:4-8.58a et al.), P.L.2004, c.40 or P.L.2007, c.62 (C.18A:7F-37 et al.), and if the refund or homestead rebate or credit is not required to be paid over to the municipal tax collector under the provisions of section 8 of P.L.1990, c.61 (C.54:4-8.64), and at the same time the taxpayer or resident shall be indebted to any agency or institution of State Government, to the Victims of Crime Compensation Board for the portion of an assessment ordered pursuant to section 2 of P.L.1979, c.396 (2C:43-3.1) for deposit in the Victims of Crime Compensation Board Account or restitution ordered to be paid to the board pursuant to N.J.S.2C:44-2 for deposit in the Victims of Crime Compensation Board Account, or for child support under Title IV-A, Title IV-D, or Title IV-E of the federal Social Security Act (42 U.S.C. s.601 et seq.), or other indebtedness in accordance with section 1 of P.L.1995, c.290 (C.2A:17-56.11b) the Department of the Treasury shall apply or cause to be applied the refund, homestead rebate or credit, or all, or so much of any or all as shall be necessary, to satisfy the indebtedness. Child support indebtedness shall take precedence over all other indebtedness. The Department of the Treasury shall retain a percentage of the proceeds of any collection setoff as shall be necessary to provide for any expenses of the collection effort.

b. A State department or agency which is owed a debt shall notify the Department of the Treasury of the existence of the debt and shall request that the Department of the Treasury execute a setoff as provided for in this section.

c. As used in this section, "refund of taxes pursuant to the "New Jersey Gross Income Tax Act" (N.J.S.54A:1-1 et seq.)" or "refund" shall include any interest allowed on a refund of an
overpayment pursuant to subsection f. of N.J.S.54A:9-7.

(cf: P.L.2007, c.62, s.38)

2. Section 8 of P.L.1990, c.61 (C.54:4-8.64) is amended to read as follows:

8. a. The tax collector of each municipality shall, on or before April 1 of each year, furnish the director with a list of property taxpayers in the district delinquent for taxes due and payable for the year immediately preceding and the amounts of such delinquencies. The collector shall report on such list the name, lot and block number on the property tax duplicate as may be applicable, and the address of each owner to whom a delinquency is attributable together with the amount of such delinquency so identified. No homestead rebate payment under this act or refund of taxes pursuant to the "New Jersey Gross Income Tax Act," N.J.S.54A:1-1 et seq., shall be made to a property owner, and no homestead credit shall be applied as provided in subsection b. of section 7 of P.L.1990, c.61 (C.54:4-8.63), while that property owner's delinquency remains; provided however that for the purposes of this act, for an assessment on a property which is on appeal and for which the statutory percentage of the tax as provided in R.S.54:3-27 has been paid, the taxes assessed on that property shall not be regarded as delinquent.

b. If the director receives the list as provided for in subsection a. of this section, and the director determines that a property tax delinquency remains for the preceding tax year on April 1, the director shall ascertain the amount of the homestead rebate or credit or refund of taxes pursuant to N.J.S.54A:1-1 et seq., required to be withheld because of such delinquency in each municipality in the State, and shall certify such amounts to the State Treasurer as soon thereafter as may be practicable.

c. On or before November 15, the director shall notify each homestead rebate or credit claimant whose rebate or credit has been withheld, or gross income tax taxpayer whose refund has been withheld, because of delinquency that the amount of the rebate or credit or refund to which the claimant or gross income taxpayer otherwise would have been entitled has been sent to the tax collector in the municipality to be credited against the claimant's delinquency.

d. Upon certification by the director as to the amount of homestead rebates or credits or refund of taxes pursuant to N.J.S.54A:1-1 et seq., required to be withheld because of delinquency in the several municipalities, the State Treasurer upon the warrant of the Director of the Division of Budget and Accounting, shall pay such amount on or before October 30 to the tax collector in each municipality.

e. The tax collector in each municipality shall credit the tax delinquency of each property taxpayer who appears on the delinquency list set forth in subsection a. of this section in the amount that otherwise would have been returned to the property taxpayer as a homestead rebate or credit or a refund of taxes pursuant to N.J.S.54A:1-1 et seq. In the event that the amount so credited by the tax collector exceeds the amount of delinquency, the tax collector may return the difference to the taxpayer or credit such amount to the subsequent property tax bill.

f. In the case of delinquency in the payment of property taxes by a cooperative, mutual housing corporation or continuing care retirement community, a homestead rebate that may be due an individual resident shall be paid by the State Treasurer to the tax collector of the municipality. The tax collector shall credit the cooperative, mutual housing corporation or continuing care retirement community with such payment and the cooperative, mutual housing corporation or continuing care retirement community shall, in turn, credit the individual unit owner to the extent of the rebate and notify the applicant of the amount to be credited.

g. If a tax collector fails to comply with the provisions of subsection a. of this section requiring the tax collector to furnish the director with a list, on or before April 1 of each year, of property taxpayers in the district delinquent for taxes due and payable for the year immediately preceding and the amounts of such delinquencies, the director shall refund any taxes pursuant to N.J.S.54A:1-1 et seq., and either pay the homestead rebate directly to the delinquent applicant rather than to the tax collector of the municipality as set forth in subsection d. of this section or provide a credit for the applicant under this act.

h. All provisions of this section shall apply to NJ SAVER rebate applications filed for and paid as homestead rebates for tax year 2003.

i. As used in this section, "refund of taxes pursuant to N.J.S.54A:1-1 et seq.," or "refund" shall include any interest allowed on a refund of an overpayment pursuant to subsection f. of N.J.S.54A:9-7.

(cf: P.L.2007, c.62, s.26)

3. This act shall take effect on July 1, 2010.

STATEMENT

This bill allows gross income tax refunds to be credited against a taxpayer's delinquent local property taxes in the same manner as is currently allowed for homestead property tax rebates and credits claimed by delinquent property tax taxpayers.