S 903 Session 111 (1995-1996)
S 0903 General Bill, By Rankin
A Bill to amend Chapter 37, Title 12, Code of Laws of South Carolina, 1976,
relating to the assessment of property taxes, by adding Article 4, "The
Homestead Property Tax Deferral for the Elderly Act", which allows elderly
individuals entitled to the homestead property tax exemption to defer all or
part of ad valorem taxes levied on the homestead by filing annual application.
06/01/95 Senate Introduced and read first time SJ-10
06/01/95 Senate Referred to Committee on Finance SJ-10
A BILL
TO AMEND CHAPTER 37, TITLE 12, CODE OF LAWS OF
SOUTH CAROLINA, 1976, RELATING TO THE ASSESSMENT
OF PROPERTY TAXES, BY ADDING ARTICLE 4, "THE
HOMESTEAD PROPERTY TAX DEFERRAL FOR THE
ELDERLY ACT", WHICH ALLOWS ELDERLY
INDIVIDUALS ENTITLED TO THE HOMESTEAD PROPERTY
TAX EXEMPTION TO DEFER ALL OR PART OF AD
VALOREM TAXES LEVIED ON THE HOMESTEAD BY
FILING AN ANNUAL APPLICATION.
Be it enacted by the General Assembly of the State of South
Carolina:
SECTION 1. Chapter 37, Title 12 of the 1976 Code is amended
by adding:
"Article 4
The Homestead Property
Tax Deferral for the Elderly Act
Section 12-37-505. This article may be cited as the Homestead
Property Tax Deferral for the Elderly Act.
Section 12-37-510. As used in this article:
(1) `Gross household income' means all income, for all
individuals residing within the household, from whatever source
derived including, but not limited to, the following sources:
(a) compensation for services including fees, commissions,
and similar items;
(b) gross income derived from business;
(c) gains derived from dealings in property;
(d) interest;
(e) rents;
(f) royalties;
(g) dividends;
(h) alimony and separate maintenance payments;
(i) income from life insurance and endowment contracts;
(j) annuities;
(k) pensions;
(l) income from discharge of indebtedness;
(m) distributive share of partnership gross income;
(n) income from an interest in an estate or trust; and
(o) federal old-age, survivor, or disability benefits.
(2) `Household' means an individual or group of individuals
living together in a room or group of rooms as a housing unit.
(3) `Tax collector' means the county auditor or municipal
officer authorized by law to receive property tax payments.
Section 12-37-515. (A) Any individual who is entitled to
claim a homestead exemption pursuant to Section 12-37-250 may
elect to defer payment of all or part of the ad valorem taxes levied
on his homestead by filing an annual application for tax deferral
with the tax collector before May first of the year for which the
deferral is sought. If the homestead for which a deferral is
requested has an assessed value for purposes of ad valorem taxation
of two thousand dollars or more, the deferral may apply only to the
taxes on that portion of the assessed value which is two thousand
dollars or less.
(B) It is the duty of each applicant for a deferral to demonstrate
affirmatively his compliance with the requirements of this article.
Section 12-37-520. (A) As an alternative to the tax deferral
authorized by Section 12-37-515, an individual who is entitled to
claim a homestead exemption pursuant to Section 12-37-250 may
elect to defer payment of all or any part of that portion of the ad
valorem taxes levied on the individual's homestead which exceeds
four percent of the individual's gross household income for the
immediately preceding calendar year. An application for tax
deferral under this section must be filed annually with the tax
collector before May first of the year for which the deferral is
sought. If an individual files for a tax deferral under this section,
he may not file for a tax deferral under Section 12-37-515.
(B) The amount of the assessed value of the homestead does not
limit the tax deferral authorized by this section.
(C) It is the duty of each applicant for a deferral under this
section to demonstrate affirmatively the applicant's compliance with
this section and other provisions of this article.
Section 12-37-522. No tax deferral in any one year may be
granted pursuant to Section 12-37-515 or Section 12-37-520:
(1) if the total amount of deferred taxes and interest plus the
total amount of all other unsatisfied liens on the homestead exceeds
eighty-five percent of the fair market value of the homestead as
shown on the county tax duplicate for the immediately preceding
tax year;
(2) if the applicant's gross household income for the
immediately preceding calendar year exceeds twenty thousand
dollars;
(3) if the homestead for which the deferral is sought is subject
to any lien, the terms of which are dictated by federal law, rule, or
regulation prohibiting deferral of taxes; or
(4) with respect to taxes levied to retire bonded indebtedness or
for special assessments.
Section 12-37-525. (A) The application for deferral must be
made upon a form prescribed by the Department of Revenue and
Taxation and furnished by the tax collector. The application form
must advise the applicant of the manner in which interest is
computed. Each application form must contain an explanation of
the conditions to be met for approval and the conditions under
which deferred taxes and interest become due, payable, and
delinquent. Each application form must clearly state that all
deferrals pursuant to this article constitute a lien on the applicant's
homestead.
(B) A form of oath must be provided and administered to the
individual seeking the deferral. The oath may be administered by
the tax collector or any individual authorized by law to administer
oaths.
(C) (1) The tax collector shall consider each annual application
for homestead tax deferral within thirty days of the date the
application is filed or as soon as practicable thereafter. If the tax
collector finds that the applicant is entitled to the tax deferral, he
shall approve the application and file the application in the
permanent records. If the tax collector finds that the applicant is
not entitled to the deferral, he shall send a notice of disapproval to
the applicant giving his reasons for the disapproval within thirty
days of the filing of the application either by personal delivery or
by certified mail to the mailing address given by the applicant, and
he shall make a return on the original notice of the manner in
which the notice was served on the applicant and shall file the
return among the permanent records of his office. The original
notice of disapproval sent to the applicant must advise the applicant
of his right to appeal the decision of the tax collector to the
Administrative Law Judge Division and must inform the applicant
of the procedure for filing an appeal.
(2) An appeal of the decision of the tax collector to the
Administrative Law Judge Division must be in the manner provided
by law for appeals to the division.
(D) Each application must contain a list and the current value of
all outstanding liens on the applicant's homestead.
(E) If proof of fire and extended coverage insurance has not
been furnished with a prior application, each applicant shall furnish
proof of this insurance in an amount which is in excess of the sum
of all outstanding liens and deferred taxes and interest with a loss
payable clause to the tax collector.
Section 12-37-530. (A) The amount of taxes deferred pursuant
to this article accrues interest until paid at the rate of eight percent a
year.
(B) Interest on taxes deferred pursuant to this article in any year
begins accruing on the date the taxes were due.
Section 12-37-535. The taxes and interest deferred pursuant to
this article constitute a prior lien and attach as of the date and in the
same manner and must be collected as are other liens for taxes, as
provided for under this title, but the deferred taxes and interest are
due, payable, and delinquent as provided in this article.
Notwithstanding any other provision of law, the lien established by
this section continues on the property until the deferred taxes and
interest are paid in full.
Section 12-37-540. Each year, at the time the tax notices are
mailed, the tax collector shall notify each property owner to whom
a homestead tax deferral has been previously granted of the
accumulated sum of deferred taxes and interest outstanding.
Section 12-37-545. (A) If there is a change in tax-deferred
property so that the owner is no longer entitled to a homestead
exemption for the property pursuant to Section 12-37-250, or if the
owner fails to maintain the required fire and extended insurance
coverage, the total amount of deferred taxes and interest for all
previous years are due and payable either on the date on which the
change occurs or on the date failure to maintain insurance occurs.
(B) If there is a change in ownership of tax-deferred property,
the total amount of deferred taxes and interest for all previous years
is due and payable on the date the change in ownership occurs.
However, when the change in ownership is to a surviving spouse
and the spouse is eligible for a homestead exemption on the
property pursuant to Section 12-37-250, the surviving spouse may
continue the deferral of previously deferred taxes and interest
pursuant to this article.
(C) During any year in which the total amount of deferred taxes,
interest, and all other unsatisfied liens on a homestead exceeds
eighty-five percent of the fair market value of the homestead, the
tax collector shall immediately notify the owner of the homestead
that the portion of taxes and interest which exceeds eighty-five
percent of the value of the homestead is due and payable within
thirty days of receipt of the notice. Failure to pay the amount due
shall cause the total amount of deferred taxes and interest also to
become due and payable at the end of the thirty days.
(D) Each year, upon notification, each owner of property on
which taxes and interest have been deferred shall submit to the tax
collector a list, and the current value, of all outstanding liens on the
owner's homestead. Failure to respond to the notification within
thirty days of its receipt shall cause the total amount of deferred
taxes and interest to become due and payable at the end of the
thirty days.
(E) All deferred taxes which are made due and payable by this
section are delinquent and subject to interest in accordance with
Section 12-54-20 beginning one hundred twenty days following the
date the deferred taxes become due and payable.
Section 12-37-550. (A) All or part of the deferred taxes and
accrued interest may be paid at any time to the tax collector by:
(1) the owner of the property or the spouse of the owner, or
(2) the next of kin of the owner, heir of the owner, child of
the owner, or any person having or claiming a legal or equitable
interest in the property, provided that no objection is made by the
owner within thirty days after the tax collector notifies the owner of
the fact that the payment has been tendered. Any payment made
under this item must be deposited in a special escrow account for
the thirty-day period; and the tax collector may not make
distribution of the amount while the funds are held in escrow.
(B) Any partial payment made pursuant to this section must be
applied first to accrued interest. By ordinance of the governing
body of the county or municipality, a minimum amount of partial
payment which may be accepted pursuant to this part may be
established, but required minimum payment may not exceed
twenty-five dollars.
Section 12-37-555. When deferred taxes or interest is
collected, the tax collector shall maintain a record of the payment,
which record must contain a description of the property and the
amount of taxes or interest collected for the property. The tax
collector shall distribute payments received to the local taxing
entities to whom the taxes are owed and the interest must be
distributed as taxes are distributed.
Section 12-37-560. If any holder of a deed to secure debt or any
mortgagee elects to pay the taxes of an applicant who qualifies for
and receives a tax deferral, the election does not give the holder of
the deed or the mortgagee the right to foreclose.
Section 12-37-565. Except with respect to requirements dictated
by federal law, rule, or regulation, no mortgage, deed to secure
debt, or other agreement may contain a provision, clause, or
statement which prohibits the owner from claiming a real property
tax deferral on his homestead. Any provision, clause, or statement
executed after December 31, 1995, is void and unenforceable.
Section 12-37-570. (A) The following penalties are imposed on
a person who wilfully files information required under this article
which is incorrect:
(1) The person shall pay the total amount of taxes and
interest deferred, which is immediately due;
(2) The person is disqualified from filing a homestead tax
deferral application for the next three years; and
(3) The person shall pay a penalty of twenty-five percent of
the total amount of taxes and interest deferred.
(B) A person against whom the penalties prescribed in this
section have been imposed may appeal the penalties imposed to the
Administrative Law Judge Division within thirty days after the
penalties are imposed."
SECTION 2. This section takes effect January 1, 1996, and first
applies with respect to property taxes due for the 1996 tax year.
SECTION 3. This act takes effect upon approval by the
Governor.
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