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SECOND REGULAR SESSION
HOUSE BILL NO. 2038
103RD GENERAL ASSEMBL Y
INTRODUCED BY REPRESENT A TIVE TERR Y .
4088H.01I JOSEPH ENGLER, Chief Clerk
AN ACT
T o amend chapter 137, RSMo, by adding thereto two new sections relating to property tax
programs for vulnerable individuals.
Be it enacted by the General Assembly of the state of Missouri, as follows:
Section A. Chapter 137, RSMo, is amended by adding thereto two new sections, to be
2 known as sections 137.104 and 137.107, to read as follows:
137.104. 1. As used in this section, the following terms mean:
2 (1) "Commission", the state tax commission;
3 (2) "Eligible owner", an individual who:
4 (a) Has reache d sixty-five years of age as of January first of the determining
5 odd-number ed year;
6 (b) Is the owner of re cord of the res idential real pr operty used as a homestead or
7 has a legal or equitable interes t in the r esidential rea l prop erty used as a homestead as
8 evidenced by a written instrument;
9 (c) Is liable for the payment of real prop erty taxes on the r esidential r eal
10 pr operty used as a homestead; and
11 (d) Has a total household income of one hundr ed twenty-five thousand dollars or
12 less, as adjusted in each successive calendar year by the incr emental incr ease in the
13 general price level, as defined under Article X, Section 17 of the Constitution of
14 Missouri;
15 (3) "Homestead", the resi dential real prop erty that is used as a primary
16 r esidence and the adjacent re al pro perty , not to exceed five acr es of land, as is
17 r easonably necessary for use of the res idence as a home dwelling;
EXPLANA TION — Matter enclosed in bold-faced brackets [thus] in the above bill is not enacted and is
intended to be omitted from the law . Matter in bold-face type in the above bill is proposed language.
18 (4) "T otal household income", the combined federal adjusted gross income of
19 the eligible owner; the eligible owner ’ s spouse, rega rdless of whether the spouse res ides
20 in the homestead; and any dependent of the eligible owner or the eligible owner’ s spouse
21 if such dependent res ides in the homestead with the eligible owner .
22 2. In addition to all other exemptions authorized under Article X, Section 6 of
23 the Constitution of Missouri or otherwise authorized by law , and as authorized under
24 Article X, Section 6(a) of the Constitution of Missouri, for all tax years beginning on or
25 after January 1, 2027, for an eligible owner , as defined under this section, an annual
26 exemption is granted for pro perty that is used as a homestead equal to one hundr ed
27 per cent of the tax assessed on the homestead.
28 3. The exemption and determination of eligibility under this section applies for
29 tax years beginning on or after January 1, 2027. The claim for an exemption shall not
30 be transferr ed or assigned. The exemption granted under this section shall be applied
31 after any other pro perty tax exemption, and apart fro m such exemptions, a taxpayer
32 who receiv ed the exemption granted under this section shall not be eligible for any other
33 pr operty tax r elief, the pro perty tax credi ts under sections 135.010 to 135.035, or any
34 other tax cr edits r elating to the owner's homestead under this chapter or chapter 135.
35 4. (1) Except as otherwise prov ided in this subsection, each eligible owner who
36 has been granted an exemption under this section shall reapp ly on an annual basis. A
37 taxpayer shall apply for the exemption by filing an application during the application
38 period in effect for the county of his or her res idence. The assessor or chief county
39 assessment officer may determine the eligibility of resi dential pr operty to r eceive the
40 exemption pr ovided by this section by application, visual inspection, questionnair e, or
41 other re asonable methods. The determination shall be made in accordance with
42 guidelines established by the commission.
43 (2) If the person qualifying for the exemption does not occupy the qualified
44 r esidence as of January first of the tax year , the exemption granted under this section
45 shall be pr orated on a monthly basis. The pror ated exemption shall apply beginning
46 with the first complete month in which the person occupies the qualified re sidence.
47 5. The exemption granted under this section shall not affect the pr ocess of setting
48 the tax rate as requ ired under Article X, Section 22 of the Constitution of Missouri and
49 section 137.073 in any prior , curr ent, or subsequent tax year .
50 6. (1) The commission may pr omulgate all necessary rules and reg ulations for
51 the administration of this section. Any rule or portion of a rule, as that term is defined
52 in section 536.010, that is creat ed under the authority delegated in this section shall
53 become effective only if it complies with and is subject to all of the provi sions of chapter
54 536 and, if applicable, section 536.028. This section and chapter 536 are nonseverable
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55 and if any of the powers vested with the general assembly pursuant to chapter 536 to
56 r eview , to delay the effective date, or to disappr ove and annul a rule are subsequently
57 held unconstitutional, then the grant of rulemaking authority and any rule pr oposed or
58 adopted after August 28, 2026, shall be invalid and void.
59 (2) No rule pr omulgated by the commission shall in any way adversely impact,
60 interrupt, or interfer e with the performance of the r equir ed statutory duties of any
61 county elected official including, but not limited to, the county collector , when
62 performing such duties as deemed necessary for the purposes of this section and the
63 distribution of all other re al and personal pro perty taxes.
64 7. Under section 23.253 of the Missouri sunset act:
65 (1) The prov isions of the new pr ogram authorized under this section shall sunset
66 six years after the effective date of this section unless reauthori zed by an act of the
67 general assembly;
68 (2) This section shall terminate on September first of the calendar year
69 immediately following the calendar year in which the prog ram authorized under this
70 section is sunset; and
71 (3) Nothing in this subsection shall prev ent a taxpayer fr om claiming a tax credit
72 pr operly issued before this pr ogram was sunset in a tax year after the prog ram is sunset.
137.107. 1. This section shall be known and may be cited as "The Missouri
2 Homestead Pr eservation Act".
3 2. As used in this section, the following terms shall mean:
4 (1) "Commission, the state tax commission;
5 (2) "Disabled", as such term is defined in section 135.010;
6 (3) "Eligible owner":
7 (a) Any individual owner of pro perty who:
8 a. Is sixty-five years of age or older as of January first of the tax year in which
9 the individual is claiming the cr edit authorized under this section or is disabled; and
10 b. Had an income of less than or equal to the maximum upper limit in the year
11 prior to completing an application under this section;
12 (b) In the case of a married couple owning pr operty either jointly or as tenants
13 by the entire ty , or in the case of a married couple wher e only one spouse owns the
14 pr operty , such couple shall be consider ed an eligible owner if:
15 a. Both spouses have reached sixty-five years of age, or one spouse is disabled; or
16 b. If one spouse is sixty-five years of age or older and the other spouse is sixty
17 years of age or older and the combined income of the couple in the year prior to
18 completing an application under this section did not exceed the maximum upper limit;
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19 (c) In the case of joint ownership by unmarried persons or ownership by tenancy
20 in common by two or mor e unmarried persons, such owners shall be consider ed an
21 eligible owner if each person with an ownership inter est individually satisfies the
22 eligibility req uir ements for an individual eligible owner under this subdivision and the
23 combined income of all individuals with an interes t in the pr operty is less than or equal
24 to the maximum upper limit in the year immediately prior to completing an application
25 under this section. If any individual with an ownership interes t in the pr operty fails to
26 satisfy the eligibility req uirements of an individual eligible owner or if the combined
27 income of all individuals with inter est in the pr operty exceeds the maximum upper limit,
28 no individual with an ownership interes t in such pr operty shall be deemed an eligible
29 owner r egardless of whether any such individual could otherwise meet the eligibility
30 r equir ements; or
31 (d) In the case of pr operty held in trust, the eligible owner and re cipient of the
32 tax cred it shall be the trust itself, prov ided that the prev ious owner of the homestead or
33 the prev ious owner's spouse:
34 a. Is the settlor of the trust with res pect to the homestead;
35 b. Curr ently res ides in such homestead; and
36 c. W ould have satisfied the age, ownership, and maximum upper limit
37 r equir ements for income as defined in this subdivision, but for the transfer of such
38 pr operty .
39
40 No individual shall be an eligible owner if the individual has not paid the individual's
41 pr operty tax liability , if any , in full by the payment due date in any of the thr ee most
42 r ecent prior tax years, except that a late payment of a prop erty tax liability in any prior
43 year shall not disqualify a potential eligible owner if such individual paid in full the tax
44 liability and any and all penalties, additions, and interes t that aro se as a res ult of such
45 late payment. No individual shall be an eligible owner if such person filed a valid claim
46 for the pr operty tax relief cr edit under sections 135.010 to 135.035;
47 (4) "Homestead", the same meaning given to such term under section 135.010,
48 except as otherwise prov ided in this section. No pr operty shall be consider ed a
49 homestead if such pr operty has been impr oved since the most recen t annual assessment
50 by mor e than five percen t of its pr eviously assessed value, except wher e an eligible
51 owner of the pr operty has made such improvements to accommodate a disabled person;
52 (5) "Homestead exemption limit", a per centage increa se, roun ded to the near est
53 hundr edth of a per cent, that is equal to the per centage incr ease in tax liability , of a
54 homestead, not including impr ovements, fr om one tax year to the next, that exceeds a
55 certain perce ntage set under subsection 7 of this section. The homestead exemption
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56 limit shall be based on the increa se in tax liability fr om two years prior to application to
57 the year immediately prior to application;
58 (6) "Income", federal adjusted gross income, except that in the case of
59 ownership of the homestead by trust, the income of the settlor applicant shall be added
60 to the income of the trust for purposes of determining eligibility with res pect to the
61 maximum upper limit;
62 (7) "Maximum upper limit", the income sum of seventy thousand dollars for the
63 2005 calendar year , incre ased each successive calendar year by the incr emental incr ease
64 in the general price level, as defined under Article X, Section 17 of the Constitution of
65 Missouri.
66 3. As pr ovided under Article X, Section 6(a) of the Constitution of Missouri, for
67 all tax years beginning on or after January 1, 2027, if in the most rece nt prior tax year
68 the pr operty tax liability on any par cel of subclass (1) r eal pr operty incr eased by mor e
69 than the homestead exemption limit, without reg ard for any prior cred it receiv ed due to
70 the pro visions of this section, any eligible owner of the pr operty shall r eceive a
71 homestead exemption cred it to be applied toward the curr ent tax year pr operty tax
72 liability to offset the prior year incr ease in tax liability that exceeds the homestead
73 exemption limit, except as eligibility for the cr edit is limited by the pr ovisions of this
74 section. The amount of the credit shall be listed separately on each taxpayer's tax bill
75 for the curren t tax year or on a document enclosed with the taxpayer's bill. The
76 homestead exemption cred it shall not affect the pr ocess of setting the tax rate as
77 r equir ed under Article X, Section 22 of the Constitution of Missouri and section 137.073
78 in any prior , curr ent, or subsequent tax year .
79 4. Any potential eligible owner may apply for the homestead exemption credit by
80 completing an application. Applications shall be accepted not earlier than April first
81 and not later than October fifteenth of any tax year in order for the taxpayer to be
82 eligible for the homestead exemption credit in the tax year next following the calendar
83 year in which the homestead exemption cr edit application is completed. The application
84 shall be on forms pr ovided by the commission or by application thr ough the local
85 assessor's office on forms provi ded by the commission. Forms shall be made available
86 on the commission's website and at all local assessors' and collectors' offices. On such
87 applications, the applicant shall attest under penalty of perjury:
88 (1) T o the applicant's age;
89 (2) That the applicant's prior year income was less than the maximum upper
90 limit;
91 (3) T o the addr ess of the homestead pr operty; and
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92 (4) That any impr ovements made to the homestead, not made to accommodate a
93 disabled person, did not total mor e than five per cent of the assessed value of the
94 homestead for the most recent prior tax year .
95
96 The applicant shall also include with the application copies of r eceipts indicating
97 payment of pr operty tax by the applicant for the homestead pr operty for the thr ee most
98 r ecent prior tax years.
99 5. Each applicant shall submit the application to the commission or the
100 assessor's office not later than October fifteenth of each year for the taxpayer to be
101 eligible for the homestead exemption credit in the tax year next following the calendar
102 year in which the application is submitted.
103 6. Upon receipt of the applications, the commission shall calculate the tax
104 liability , verify compliance with the maximum income limit, verify the ages of the
105 applicants, and make adjustments to these numbers as necessary on the applications.
106 The commission shall disallow any application if the applicant also has filed a valid
107 application for the pr operty tax cred it authorized under sections 135.010 to 135.035.
108 Once the applicant's adjusted tax liability , age, and income are verified, the commission
109 shall determine eligibility for the cr edit and pr ovide a list of all verified eligible owners
110 to the county assessors, or county clerks in counties with a township form of government
111 notwithstanding section 32.057, not later than December fifteenth of each year . Not
112 later than the following January fifteenth, the county assessors shall prov ide a list to the
113 commission of any verified eligible owners who made improvements to the homestead
114 not for accommodation of a disability and the dollar amount of the assessed value of
115 such improvements . If the dollar amount of the assessed value of such impro vements
116 totals mor e than five per cent of the assessed value fr om the most recent prior tax year ,
117 such eligible owners shall be disqualified fr om receiv ing the cr edit in the curr ent tax
118 year .
119 7. The commission shall calculate the level of appr opriation necessary to set the
120 homestead exemption limit for the homesteads of all verified eligible owners at five
121 per cent when based on a year of general rea ssessment or at two and one-half percen t
122 when based on a year without general r eassessment. The commission shall prov ide such
123 calculation to the speaker of the house of r epresent atives, the presiden t pr o tempor e of
124 the senate, and the direc tor of the office of budget and planning in the office of
125 administration not later than January thirty-first of each year .
126 8. If, in any given year , the general assembly makes an appr opriation for the
127 funding of the homestead exemption cred it that is signed by the governor , the
128 commission shall determine the apportionment per centage to set the homestead
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129 exemption limit by apportioning the appr opriation among all eligible applicants on a
130 per centage basis, so that the total amount of all cred its applied for in a given year is the
131 denominator and the amount of an applicant's cr edit applied for in a given year is the
132 numerator . If no appr opriation is made by the general assembly during any given year
133 or no funds are actually distributed pursuant to any appr opriation ther efor , no
134 homestead preservat ion cred it shall apply in such year .
135 9. After determining the apportionment per centage, the commission shall
136 calculate the cred it to be associated with each verified eligible owner's homestead, if any .
137 The commission shall send a list of those eligible owners who ar e to receiv e the
138 homestead exemption cre dit, including the amount of each cred it, the certified par cel
139 number of the homestead, and the addr ess of the homestead pro perty , to the county
140 collectors, or county clerks in counties with a township form of government
1 4 1 notwithstanding section 32.057, not later than August thirty-first. Pursuant to such
142 calculation, the commission shall instruct the state tr easurer to distribute the
14 3 appr opriation to the county collector's fund of each county or the tr easur er ex officio
144 collector's fund in counties with a township form of government, wher e r ecipients of the
145 homestead exemption credi t are located, in such amounts as would exactly offset each
146 homestead exemption cred it being issued. In no case shall a political subdivision
147 r eceive, as a r esult of appr opriations, mor e moneys than it would have recei ved absent
148 the pr ovisions of this section. At the dir ection of the county collector or the trea sur er ex
149 officio collector in counties with a township form of government, funds may be
150 deposited in the county collector's fund of a county or the tre asurer ex officio collector's
151 fund or may be sent by mail to the county collector , or the trea sur er ex officio collector
152 in counties with a township form of government, not later than October first in any year
153 a homestead exemption cred it is appr opriated as a res ult of this section and shall be
154 distributed as moneys in such funds ar e commonly distributed fro m other prop erty tax
155 r evenues by the county collector , or the tr easurer ex officio collector of the county in
156 counties with a township form of government, in such amounts as would exactly offset
157 each homestead exemption credit being issued.
158 10. In the event that an eligible owner dies or transfers ownership of the
159 pr operty after the homestead exemption limit has been set in any given year , but on or
160 befor e December thirty-first of the year in which the credit would otherwise be applied,
161 the credi t shall be void and any corr esponding moneys shall lapse to the state to be
162 cr edited to the general rev enue fund. In the event the county collector , or the tre asurer
163 ex officio collector of the county in counties with a township form of government,
164 determines prior to issuing the cred it that the individual is not an eligible owner because
165 the individual did not pay his or her pr operty tax liability in full for the most recen t
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166 prior thr ee years, the cred it shall be void and any corr esponding moneys shall lapse to
167 the state to be cr edited to the general reven ue fund. In the event the cred it has alrea dy
168 been issued or applied, the commission shall have the authority to recap tur e the benefit
169 of the cred it in such cases under this subsection.
170 1 1. (1) The state tax commission may pro mulgate all necessary rules and
171 r egulations for the administration of this section. Any rule or portion of a rule, as that
172 term is defined in section 536.010, that is creat ed under the authority delegated in this
173 section shall become effective only if it complies with and is subject to all of the
174 pr ovisions of chapter 536 and, if applicable, section 536.028. This section and chapter
175 536 are nonseverable and if any of the powers vested with the general assembly
176 pursuant to chapter 536 to revi ew , to delay the effective date, or to disappr ove and annul
177 a rule are subsequently held unconstitutional, then the grant of rulemaking authority
178 and any rule prop osed or adopted after August 28, 2026, shall be invalid and void.
179 (2) Any rule promul gated under this section by the commission shall in no way
180 adversely impact, affect, interrupt, or interfer e with the performance of the r equir ed
181 statutory duties of any county elected official, mor e particularly including the county
182 collector when performing such duties as deemed necessary for the distribution of any
183 homestead appr opriation and the collection of all other real and personal pr operty
184 taxes.
185 12. Under section 23.253 of the Missouri sunset act:
186 (1) The prov isions of the new pr ogram authorized under this section shall sunset
187 six years after the effective date of this section unless reauthori zed by an act of the
188 general assembly;
189 (2) This section shall terminate on September first of the calendar year
190 immediately following the calendar year in which the prog ram authorized under this
191 section is sunset; and
192 (3) Nothing in this subsection shall prev ent a taxpayer fr om claiming a tax credit
193 pr operly issued before this pr ogram was sunset in a tax year after the prog ram is sunset.
✔
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