Authorizes the "Missouri Homestead Preservation Act"

SECOND REGULAR SESSION
HOUSE BILL NO. 2981
103RD GENERAL ASSEMBL Y
INTRODUCED BY REPRESENT A TIVE BUR TON.
4630H.01I JOSEPH ENGLER, Chief Clerk
AN ACT
T o amend chapter 137, RSMo, by adding thereto one new section relating to the Missouri
homestead preservation act, with a delayed ef fective date.
Be it enacted by the General Assembly of the state of Missouri, as follows:
Section A. Chapter 137, RSMo, is amended by adding thereto one new section, to be
2 known as section 137.107, to read as follows:
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 mean:
4 (1) "Department", the department of revenu e;
5 (2) "Dir ector", the dir ector of the department of reve nue;
6 (3) "Disabled", the same meaning as such term is defined under section 135.010;
7 (4) "Eligible owner":
8 (a) Any individual owner of prop erty who is sixty-five years of age or older as of
9 January first of the tax year in which the individual is claiming the credit authorized
10 under this section or who is disabled and who had an income of less than or equal to the
11 maximum upper limit in the year 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 entir ety , or in the case of a married couple in which only one spouse owns the
14 pr operty , such couple shall be consider ed an eligible owner if both spouses have reach ed
15 sixty-five years of age, if one spouse is disabled, or if one spouse is sixty-five years of age
16 or older and the other spouse is sixty years of age or older , and the combined income of
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.
17 the couple in the year prior to completing an application under this section did not
18 exceed the maximum upper limit;
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 individuals with an ownership interes t in such prop erty shall be deemed an eligible
29 owner , regar dless of whether any such individuals 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 tax year shall not disqualify a potential eligible owner if such individual paid in full the
44 tax liability and any and all penalties, additions, and interes t that arose as a res ult of
45 such late payment. No individual shall be an eligible owner if such person filed a valid
46 claim for the prop erty tax r elief cred it under sections 135.010 to 135.035;
47 (5) "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 its most recent 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 (6) "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 percen tage incr ease in tax liability , not
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54 including improvements , of a homestead 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
56 limit shall be based on the increa se in tax liability fr om two years prior to the
57 application to the year immediately prior to the application;
58 (7) "Income", federal adjusted gross income, except that in the case of
59 ownership of the homestead by a trust, the income of the settlor applicant shall be
60 imputed to the income of the trust for purposes of determining eligibility with r espect to
61 the maximum upper limit;
62 (8) "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. Under Article X, Section 6(a) of the Constitution of Missouri, for all tax years
67 beginning on or after January 1, 2027, if in the most recen t prior tax year the pr operty
68 tax liability on any par cel of subclass (1) re al prope rty incr eased by mor e than the
69 homestead exemption limit, without regar d for any prior cr edit rec eived due to the
70 pr ovisions of this section, any eligible owner of the prop erty shall recei ve a homestead
71 exemption credi t to be applied toward the curre nt tax year pr operty tax liability to
72 offset the prior year incr ease in tax liability that exceeds the homestead exemption limit,
73 except as eligibility for the cred it is limited by the pr ovisions of this section. The amount
74 of the cred it shall be listed separately on each taxpayer's tax bill for the curr ent tax year
75 or on a document enclosed with the taxpayer's bill. The homestead exemption credit
76 shall not affect the pr ocess of setting the tax rate as r equir ed under Article X, Section 22
77 of the Constitution of Missouri and section 137.073 in any prior , curren t, or subsequent
78 tax year .
79 4. Any potential eligible owner may apply for the homestead exemption credit by
80 completing an application. Applications shall be completed 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 department. Forms shall be made available on the
85 department's website and at all permanent branch offices and all full-time, temporary ,
86 and fee offices maintained by the department of reven ue. On such applications, the
87 applicant shall attest under penalty of perjury:
88 (1) T o the applicant's age;
89 (2) That the applicant's prior year's income was less than the maximum upper
90 limit;
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91 (3) T o the addr ess of the homestead pr operty; and
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 department not later than
100 October fifteenth of each year for the taxpayer to be eligible for the homestead
101 exemption cred it in the tax year next following the calendar year in which the
102 application was submitted.
103 6. Upon r eceipt of the application, the department shall calculate the tax liability ,
104 verify compliance with the maximum income limit, verify the ages of the applicants, and
105 make adjustments to these numbers as necessary on the applications. The department
106 shall disallow any application if the applicant has also filed a valid application for the
107 pr operty tax credit authorized under sections 135.010 to 135.035. Once adjusted tax
108 liability , age, and income are verified, the dir ector shall determine eligibility for the
109 cr edit and pr ovide a list of all verified eligible owners to the county assessors, or county
110 clerks in counties with a township form of government, notwithstanding section 32.057,
111 not later than December fifteenth of each year . Not later than the following January
112 fifteenth, the county assessors shall pr ovide a list to the department of any verified
113 eligible owners who made improve ments, not for accommodation of a disability , to the
114 homestead and the dollar amount of the assessed value of such improvements. If the
115 dollar amount of the assessed value of such impr ovements totals mor e than five per cent
116 of the assessed value fr om the most r ecent prior tax year , such eligible owners shall be
117 disqualified fr om r eceiving the cr edit in the curren t tax year .
118 7. The dir ector shall calculate the level of appr opriation necessary to set the
119 homestead exemption limit for the homesteads of all verified eligible owners at five
120 per cent when based on a year of general rea ssessment or at two and one-half percen t
121 when based on a year without general reas sessment. The dir ector shall pr ovide such
122 calculation to the speaker of the house of r epresent atives, the presiden t pr o tempor e of
123 the senate, and the direc tor of the office of budget and planning in the office of
124 administration not later than January thirty-first of each year .
125 8. If, in any given year , the general assembly makes an appr opriation for the
126 funding of the homestead exemption cred it that is signed by the governor , the dir ector
127 shall determine the apportionment perc entage by apportioning the appr opriation
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128 among all eligible applicants on a per centage basis. If no appr opriation is made by the
129 general assembly during any tax year or no funds are actually distributed pursuant to
130 any appr opriation ther efor , no homestead preservat ion cr edit shall apply in such year .
131 9. After determining the apportionment percen tage, the dir ector shall calculate
132 the cred it to be associated with each verified eligible owner's homestead, if any . The
133 dir ector shall send a list of those eligible owners who ar e to r eceive the homestead
134 exemption cr edit, including the amount of each credit, the certified par cel number of the
135 homestead, and the addr ess of the homestead pr operty , to the county collectors, or
136 county clerks in counties with a township form of government, notwithstanding section
137 32.057, not later than August thirty-first. Pursuant to such calculation, the dir ector
138 shall instruct the state tr easurer to distribute the appr opriation to the county collector's
139 fund of each county wher e reci pients of the homestead exemption cred it are located, in
140 such amounts as would exactly offset each homestead exemption cr edit being issued. In
141 no case shall a political subdivision receive , as a result of appr opriations, mor e moneys
142 than it would have received absent the pr ovisions of this section. At the dir ection of the
143 county collector , or tr easurer ex officio collector in counties with a township form of
144 government, funds may be deposited in the county collector's fund or may be sent by
145 mail to the collector of a county , or tre asurer ex officio collector in counties with a
146 township form of government, not later than October first in any year a homestead
147 exemption cre dit is appr opriated as a re sult of this section, and shall be distributed as
148 moneys in such funds ar e commonly distributed fro m other pro perty tax rev enues by
149 the county collector , or tr easurer ex officio collector in counties with a township form of
150 government, in such amounts as would exactly offset each homestead exemption credit
151 being issued.
152 10. In the event that an eligible owner dies or transfers ownership of the
153 pr operty after the homestead exemption limit has been set in any given year but before
154 January first of the year in which the cred it would otherwise be applied, the credi t shall
155 be void and any corr esponding moneys shall lapse to the state to be credited to the
156 general revenu e fund. In the event that the county collector , or the tr easurer ex officio
157 collector in counties with a township form of government, determines prior to issuing
158 the cr edit that an individual is not an eligible owner because the individual did not pay
159 his or her pr operty tax liability in full for the most recen t prior thr ee years, the credit
160 shall be void and any corr esponding moneys shall lapse to the state to be cr edited to the
161 general reven ue fund.
162 1 1. (1) The department may pr omulgate rules and regu lations for the
163 implementation and administration of this section. Any rule or portion of a rule, as that
164 term is defined in section 536.010, that is creat ed under the authority delegated in this
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165 section shall become effective only if it complies with and is subject to all of the
166 pr ovisions of chapter 536 and, if applicable, section 536.028. This section and chapter
167 536 are nonseverable and if any of the powers vested with the general assembly
168 pursuant to chapter 536 to revi ew , to delay the effective date, or to disappr ove and annul
169 a rule are subsequently held unconstitutional, then the grant of rulemaking authority
170 and any rule prop osed or adopted after August 28, 2026, shall be invalid and void.
171 (2) No rule pr omulgated by the department shall in any way adversely impact,
172 interrupt, or interfer e with the performance of the r equir ed statutory duties of any
173 county elected official including, but not limited to, the county collector , when
174 performing such duties as deemed necessary for the distribution of any homestead
175 appr opriation and the distribution of all other rea l and personal prop erty taxes.
176 12. Under section 23.253 of the Missouri sunset act:
177 (1) The pr ovisions of this section shall sunset six years after the effective date of
178 this section unless r eauthorized by an act of the general assembly; and
179 (2) This section shall terminate on January first of the calendar year
180 immediately following the calendar year in which the pr ovisions of this section are
181 sunset.
Section B. The enactment of section 137.107 of section A of this act shall become
2 ef fective on January 1, 2027.
✔
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