May 30--HAMPTON -- Elderly and disabled residents asking why they must pay real estate taxes when they were once exempt have lit up switchboards at the Commissioner of Revenue's office this week.
The City Council agreed earlier this spring to remove the option for elderly and disabled residents to receive real estate tax exemptions. Those residents must now either defer their tax liability or freeze the rate they pay.
Letters notifying them of the changes were mailed late last week.
Andrew Puckett said he had been excluded from paying property taxes for years.
"This could be a burden to all of the seniors and disabled," Puckett told City Council members Wednesday. "If you're a millionaire, it's not going to hurt you, but if you're a working person, this is going to be difficult."
Earlier this month, the City Council agreed to remove an option for eligible residents to receive either partial or full exemptions from their real estate tax bill, leaving options to either defer the tax or freeze the rate they pay.
At the time, City Council members said property tax exemptions -- including one provided to military veterans -- were creating a financial strain on the city.
To qualify for the tax relief, residents must be 65 or permanently and totally disabled before Dec. 31, 2013. They must own and occupy their dwelling and have a household income of $50,000 or less from everyone occupying the house. The combined assets of everyone in the home must not exceed $200,000, excluding the value of the home and as much as 10 acres of land where the home is located. They must apply for the exemption annually.
Close to 2,100 property owners meet the requirements needed to receive property tax relief.
"The biggest question we've been getting is who was responsible for the decision," said Mary Joyner, a Commissioner of the Revenue tax management specialist. "We've been directing them to the City Council and the city manager's office.
The changes will affect property owners' tax bills due in December.
If qualifying residents do not respond to the city's letter, the Commissioner of the Revenue's office will contact those people to determine if they want to freeze or defer their taxes, Joyner said.
"They can set up appointments with our office if they want to go over their specific situation," she said.
In July 2012, Newport News began allowing elderly and disabled residents who meet specific requirements to defer their property taxes.
The city will place a lien on properties where the owner chooses the deferral option until the property sells or until within a year after the last applicable residents of the property dies.
Residents choosing to freeze their tax liability establish a maximum amount of what they pay for property taxes. Those bills are still due with the city's regular billing cycle.
Residents deferring taxes do not pay property taxes until the property is sold or the title is transferred without penalty to the property owner or the owner dies. The deferral is considered a lien on the property.
City Manager Mary Bunting said she assumes most people will chose to defer their taxes.
Brauchle can be reached by phone at 757-247-2827.
Real estate taxes
Who is eligible: Residents must be 65 or permanently and totally disabled before Dec. 31, 2013. They must own and occupy their dwelling and have a household income of $50,000 or less from everyone occupying the house. The combined assets of everyone in the home must also not exceed $200,000 excluding the value of the home and as much as 10 acres of land where the home is located.
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