Bill Text: TX HB1597 | 2013-2014 | 83rd Legislature | Enrolled

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Bill Title: Relating to installment payments of ad valorem taxes.

Spectrum: Moderate Partisan Bill (Democrat 7-1)

Status: (Passed) 2013-06-14 - Effective on 9/1/13 [HB1597 Detail]

Download: Texas-2013-HB1597-Enrolled.html

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H.B. No. 1597

AN ACT
relating to installment payments of ad valorem taxes.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 31.031, Tax Code, is amended to read as
follows:
Sec. 31.031. INSTALLMENT PAYMENTS OF CERTAIN HOMESTEAD
TAXES. (a) This section applies only to:
(1) an individual who is:
(A) disabled or at least 65 years of age; and
(B) qualified for an exemption under Section
11.13(c); or
(2) an individual who is[:
[(A) the unmarried surviving spouse of a disabled
veteran; and
[(B)] qualified for an exemption under Section
11.22.
(a-1) An [If before the delinquency date an] individual to
whom this section applies may pay [pays at least one-fourth of] a
taxing unit's taxes imposed on property that the person owns and
occupies as a residence homestead in four equal installments
without penalty or interest if the first installment is paid before
the delinquency date and is[,] accompanied by notice to the taxing
unit that the person will pay the remaining taxes in three equal
installments[, the person may pay the remaining taxes without
penalty or interest in three equal installments]. The second
[first] installment must be paid before April 1, the third [second]
installment before June 1, and the fourth [third] installment
before August 1.
(a-2) Notwithstanding the deadline prescribed by Subsection
(a-1) for payment of the first installment, an individual to whom
this section applies may pay the taxes in four equal installments as
provided by Subsection (a-1) if the first installment is paid and
the required notice is provided before March 1.
(b) If the individual fails to make a payment, including the
first payment, before the applicable date provided by Subsection
(a-1) [(a)], the unpaid amount is delinquent and incurs a penalty of
six percent and interest as provided by Section 33.01(c). The
penalty provided by Section 33.01(a) does not apply to the unpaid
amount.
(c) An individual may pay more than the amount due for each
installment and the amount in excess of the amount due shall be
credited to the next installment. An individual may not pay less
than the total amount due for each installment unless the collector
provides for the acceptance of partial payments under this section.
If the collector accepts a partial payment, penalties and interest
are incurred only by the amount of each installment that remains
unpaid on the applicable date provided by Subsection (a-1) [(a)].
(d) If the delinquency date for taxes to which this section
applies is postponed to May 1 or a later date, the collector shall
extend each installment deadline provided by Subsection (a-1) [(a)]
by the number of months that the delinquency date was postponed.
SECTION 2. Section 33.02, Tax Code, is amended by amending
Subsections (a) and (b) and adding Subsection (b-1) to read as
follows:
(a) The collector for a taxing unit may enter into an
agreement with a person delinquent in the payment of the tax for
payment of the tax, penalties, and interest in installments. The
collector for a taxing unit shall, on request by a person delinquent
in the payment of the tax on a residence homestead, enter into an
agreement with the person for payment of the tax, penalties, and
interest in installments if the person has not entered into an
installment agreement with the collector for the taxing unit under
this section in the preceding 24 months. An installment [The]
agreement under this section:
(1) must be in writing;
(2) must provide for payments to be made in equal
monthly installments;
(3) must extend for a period of at least 12 months; and
(4) may not extend for a period of more than 36 months.
(b) Except as provided by Subsection (b-1), interest
[Interest] and a penalty accrue as provided by Sections 33.01(a)
and (c) [Subsections (a) and (c) of Section 33.01] on the unpaid
balance during the period of the agreement.
(b-1) Except as otherwise provided by this subsection, a
penalty does not accrue as provided by Section 33.01(a) on the
unpaid balance during the period of the agreement if the property
that is the subject of the agreement is a residence homestead. If
the property owner fails to make a payment as required by the
agreement, a penalty accrues as provided by Section 33.01(a) on the
unpaid balance as if the owner had not entered into the agreement.
SECTION 3. Section 33.04, Tax Code, is amended to read as
follows:
Sec. 33.04. NOTICE OF DELINQUENCY. (a) At least once each
year the collector for a taxing unit shall deliver a notice of
delinquency to each person whose name appears on the current
delinquent tax roll. However, the notice need not be delivered if:
(1) a bill for the tax was not mailed under Section
31.01(f); or
(2) the collector does not know and by exercising
reasonable diligence cannot determine the delinquent taxpayer's
name and address.
(b) A notice of delinquency must contain the following
statement in capital letters: "IF THE PROPERTY DESCRIBED IN THIS
DOCUMENT IS YOUR RESIDENCE HOMESTEAD, YOU SHOULD CONTACT THE (NAME
OF TAXING UNIT) REGARDING A RIGHT YOU MAY HAVE TO ENTER INTO AN
INSTALLMENT AGREEMENT DIRECTLY WITH THE (NAME OF TAXING UNIT) FOR
THE PAYMENT OF THESE TAXES."
(c) The collector for a taxing unit must deliver a notice of
delinquency to a person who is in breach of an installment agreement
under Section 33.02 and to any other owner of an interest in the
property subject to the agreement whose name appears on the
delinquent tax roll before the collector may seize and sell the
property or file a suit to collect a delinquent tax subject to the
agreement.
SECTION 4. Chapter 51, Property Code, is amended by adding
Section 51.0011 to read as follows:
Sec. 51.0011. DEFAULT ARISING FROM DELINQUENT AD VALOREM
TAXES: INSTALLMENT AGREEMENTS. (a) Notwithstanding any agreement
to the contrary, a debtor is not in default under a deed of trust or
other contract lien on real property used as the debtor's residence
for the delinquent payment of ad valorem taxes if:
(1) the debtor gave notice to the mortgage servicer of
the intent to enter into an installment agreement with the taxing
unit under Section 33.02, Tax Code, for the payment of the taxes at
least 10 days before the date the debtor entered into the agreement;
and
(2) the property is protected from seizure and sale
and a suit may not be filed to collect a delinquent tax on the
property as provided by Section 33.02(d), Tax Code.
(b) A mortgage servicer who receives a notice described by
Subsection (a)(1) may pay the taxes subject to the installment
agreement at any time.
(c) A mortgage servicer who receives a notice described by
Subsection (a)(1) and gives the debtor notice that the mortgage
servicer intends to accelerate the note securing the deed of trust
or other contract lien as a result of the delinquency of the taxes
that are subject to the installment agreement must rescind the
notice if the debtor enters into the agreement not later than the
30th day after the date the debtor delivers the notice.
SECTION 5. (a) The change in law made by this Act to Section
31.031, Tax Code, applies only to ad valorem taxes imposed for a tax
year beginning on or after the effective date of this Act.
(b) The change in law made by this Act to Section 33.02, Tax
Code, applies only to an installment agreement for the payment of
delinquent ad valorem taxes entered into on or after the effective
date of this Act. An installment agreement for the payment of
delinquent ad valorem taxes entered into before the effective date
of this Act is governed by the law in effect on the date the
agreement was entered into, and the former law is continued in
effect for that purpose.
(c) The change in law made by this Act to Section 33.04, Tax
Code, applies only to a notice of delinquency delivered on or after
the effective date of this Act. A notice of delinquency delivered
before the effective date of this Act is governed by the law in
effect on the date the notice was delivered, and the former law is
continued in effect for that purpose.
SECTION 6. This Act takes effect September 1, 2013.
______________________________ ______________________________
President of the Senate Speaker of the House
I certify that H.B. No. 1597 was passed by the House on May 7,
2013, by the following vote: Yeas 143, Nays 1, 2 present, not
voting.
______________________________
Chief Clerk of the House
I certify that H.B. No. 1597 was passed by the Senate on May
22, 2013, by the following vote: Yeas 31, Nays 0.
______________________________
Secretary of the Senate
APPROVED: _____________________
Date
_____________________
Governor