News Column

Homesteads High on Tax Shelter Lists

Jan. 2, 2013

Pamela Wood

Ruth Gausman just wanted to be a good neighbor.

She helped some elderly homeowners apply for the Homestead Tax Credit, which limits increases in property taxes.

But Gausman and her neighbors are among many who have been frustrated with the state bureaucracy as the Dec. 31 application deadline approaches.

Though she helped her neighbors apply back in September, the state's website still shows no applications have been received for those properties. And phone calls to the state Department of Assessments and Taxation often end up disconnected.

"The process is broken here," said Gausman, who lives in Davidsonville.

The homestead credit caps the amount a homeowner's taxes can go up each year -- 10 percent for the state portion of the tax and 2 percent for the Anne Arundel portion.

For decades, the credit was applied automatically, but the law was changed five years ago, requiring all homeowners to fill out a form to get the tax credit. The goal was to weed out people who were improperly getting the credit, perhaps on second homes or rental properties.

The deadline to apply is Dec. 31, and a rush of last-minute applications has created a backlog at the Department of Assessments and Taxation office.

Clerks are answering phone calls at a rate of 200 an hour -- with many more callers not able to get through. Those callers encounter a recorded message and then are disconnected.

Emails are numbering in the thousands, and the paper applications are piling up at the Baltimore office. On one day in December, 12,000 applications arrived in the mail, said Robert E. Young, director of the Department of Assessments and Taxation.

The deluge of phone calls, emails and applications has been going on for several months, and has only gotten more intense in the final days.

Employees have been borrowed from other parts of the Department of Assessments and Taxation to help the homestead program.

"We've made adjustments as best we can," Young said. "It's the old traditional story that everyone waits until the deadline."

Before the law was changed, more than 1.3 million homeowners were getting the credit. Right now, 500,000 homeowners are in line to get the credit for 2013, although that number is sure to go up as the backlog of paperwork is worked through.

Young asks homeowners to be patient as his staff catches up. With so many people calling, they haven't been able to make a dent in processing applications.

Staffers are working on applications submitted in September and October, said Owen Charles, deputy director of the Department of Assessments and Taxation.

Homeowners who are certain they have filed for the homestead credit do not need to take any further action, officials said. Once the homestead credit is approved, there is no need to re-apply.

Homeowners can check the status of their application by searching their property record at A line at the bottom of the property's page lists the homestead status, although applications from the last few months are not yet reflected online.

Homeowners who aren't sure whether they applied should send in a new application -- even though that will make more work for the state, Young said.

"When in doubt, it's better to err on the side of doing it," he said.

Applications need to be postmarked by Dec. 31 to meet the deadline. But because state offices are closed that day -- it's a furlough day -- in-person applications also will be accepted on the next business day, Jan. 2.

Anne Arundel County's assessment office is on the third floor of 45 Calvert St. in downtown Annapolis.

Ron Secunda of Gambrills is one of the homeowners who sent in the homestead form months ago, but has been frustrated to see the application not noted online.

Secunda said he applied for the homestead credit back in October.

"I figured I was so early, I wouldn't have a problem. I kept checking the website and it said 'no application,'" he said.

An email message he sent to the governor's office just got forwarded to the Department of Assessments and Taxation, which sent him the same basic information that's online.

Just to be sure, Secunda decided to send another application via certified mail on Friday.

"They stirred up a lot of business and they can't handle it," he said.


Distributed by MCT Information Services

Source: (c) 2012 The Capital, Annapolis, Md.

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