Sub. H. B. No. 311 As Reported by the House Ways and Means Committee

As Reported by the House Ways and Means Committee

130th General Assembly

Regular Session

2013-2014

Sub. H. B. No. 311

Representatives Boose, Retherford

Cosponsor: Representative Winburn

A BILL

To amend sections 323.152 and 4503.065 of the Revised

Code and Section 803.80 of Am. Sub. H.B. 59 of the

130th General Assembly to clarify the effective

date of an income tax deduction, to extend the

availability of a corporation franchise tax

credit, to clarify that a person eligible for the

homestead exemption without income limits

continues to receive that exemption if the

person's homestead changes, and to declare an

emergency.

BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:

Section 1. That sections 323.152 and 4503.065 of the Revised	11
Code be amended to read as follows:	12

Sec. 323.152. In addition to the reduction in taxes required	13
under section 319.302 of the Revised Code, taxes shall be reduced	14
as provided in divisions (A) and (B) of this section.	15

(A)(1) Division (A) of this section applies to any of the	16
following persons:	17

(a) A person who is permanently and totally disabled;

(b) A person who is sixty-five years of age or older;

(c) A person who is the surviving spouse of a deceased person	20
who was permanently and totally disabled or sixty-five years of	21
age or older and who applied and qualified for a reduction in	22
taxes under this division in the year of death, provided the	23
surviving spouse is at least fifty-nine but not sixty-five or more	24
years of age on the date the deceased spouse dies.	25

(2) Real property taxes on a homestead owned and occupied, or	26
a homestead in a housing cooperative occupied, by a person to whom	27
division (A) of this section applies shall be reduced for each	28
year for which an application for the reduction has been approved.	29
The reduction shall equal one of the following amounts, as	30
applicable to the person:	31

(a) If the person received a reduction under division (A) of	32
this section for tax year 2006, the greater of the reduction for	33
that tax year or the amount computed under division (A)(3) of this	34
section;	35

(b) If the person received, for any homestead, a reduction	36
under division (A) of this section for tax year 2013 or under	37
section 4503.066 of the Revised Code for tax year 2014, the amount	38
computed under division (A)(3) of this section. For purposes of	39
divisions (A)(2)(b) and (c) of this section, a person receives a	40
reduction under division (A) of this section or under section	41
4503.065 of the Revised Code for tax year 2013 or 2014,	42
respectively, if the person files a late application for that	43
respective tax year that is approved by the county auditor under	44
section 323.153 or 4503.066 of the Revised Code.	45

(c) If the person did not receive a reduction under division	46
(A) of this section or under section 4503.066 of the Revised Code	47
for tax year 2013 and the person's total income does not exceed	48
thirty thousand dollars, as adjusted under division (A)(4) of this	49
section, the amount computed under division (A)(3) of this	50
section.	51

(3) The amount of the reduction under division (A)(3) of this	52
section equals the product of the following:	53

(a) Twenty-five thousand dollars of the true value of the	54
property in money;	55

(b) The assessment percentage established by the tax	56
commissioner under division (B) of section 5715.01 of the Revised	57
Code, not to exceed thirty-five per cent;	58

(c) The effective tax rate used to calculate the taxes	59
charged against the property for the current year, where	60
"effective tax rate" is defined as in section 323.08 of the	61
Revised Code;	62

(d) The quantity equal to one minus the sum of the percentage	63
reductions in taxes received by the property for the current tax	64
year under section 319.302 of the Revised Code and division (B) of	65
section 323.152 of the Revised Code.	66

(4) Each calendar year, the tax commissioner shall adjust the	67
total income threshold described in division (A)(2)(c) of this	68
section by completing the following calculations in September of	69
each year:	70

(a) Determine the percentage increase in the gross domestic	71
product deflator determined by the bureau of economic analysis of	72
the United States department of commerce from the first day of	73
January of the preceding calendar year to the last day of December	74
of the preceding calendar year;	75

(b) Multiply that percentage increase by the total income	76
threshold for the current tax year;	77

(c) Add the resulting product to the total income threshold	78
for the current tax year;	79

(d) Round the resulting sum to the nearest multiple of one	80
hundred dollars.	81

The commissioner shall certify the amount resulting from the	82
adjustment to each county auditor not later than the first day of	83
December each year. The certified amount applies to the following	84
tax year for persons described in division (A)(2)(c) of this	85
section. The commissioner shall not make the adjustment in any	86
calendar year in which the amount resulting from the adjustment	87
would be less than the total income threshold for the current tax	88
year.	89

(B) To provide a partial exemption, real property taxes on	90
any homestead, and manufactured home taxes on any manufactured or	91
mobile home on which a manufactured home tax is assessed pursuant	92
to division (D)(2) of section 4503.06 of the Revised Code, shall	93
be reduced for each year for which an application for the	94
reduction has been approved. The amount of the reduction shall	95
equal two and one-half per cent of the amount of taxes to be	96
levied by qualifying levies on the homestead or the manufactured	97
or mobile home after applying section 319.301 of the Revised Code.	98
For the purposes of this division, "qualifying levy" has the same	99
meaning as in section 319.302 of the Revised Code.	100

(C) The reductions granted by this section do not apply to	101
special assessments or respread of assessments levied against the	102
homestead, and if there is a transfer of ownership subsequent to	103
the filing of an application for a reduction in taxes, such	104
reductions are not forfeited for such year by virtue of such	105
transfer.	106

(D) The reductions in taxable value referred to in this	107
section shall be applied solely as a factor for the purpose of	108
computing the reduction of taxes under this section and shall not	109
affect the total value of property in any subdivision or taxing	110
district as listed and assessed for taxation on the tax lists and	111
duplicates, or any direct or indirect limitations on indebtedness	112
of a subdivision or taxing district. If after application of	113
sections 5705.31 and 5705.32 of the Revised Code, including the	114
allocation of all levies within the ten-mill limitation to debt	115
charges to the extent therein provided, there would be	116
insufficient funds for payment of debt charges not provided for by	117
levies in excess of the ten-mill limitation, the reduction of	118
taxes provided for in sections 323.151 to 323.159 of the Revised	119
Code shall be proportionately adjusted to the extent necessary to	120
provide such funds from levies within the ten-mill limitation.	121

(E) No reduction shall be made on the taxes due on the	122
homestead of any person convicted of violating division (D) or (E)	123
of section 323.153 of the Revised Code for a period of three years	124
following the conviction.	125

Sec. 4503.065. (A) This section applies to any of the	126
following persons:	127

(1) An individual who is permanently and totally disabled;

128

(2) An individual who is sixty-five years of age or older;

129

(3) An individual who is the surviving spouse of a deceased	130
person who was permanently and totally disabled or sixty-five	131
years of age or older and who applied and qualified for a	132
reduction in assessable value under this section in the year of	133
death, provided the surviving spouse is at least fifty-nine but	134
not sixty-five or more years of age on the date the deceased	135
spouse dies.	136

(B) The manufactured home tax on a manufactured or mobile	137
home that is paid pursuant to division (C) of section 4503.06 of	138
the Revised Code and that is owned and occupied as a home by an	139
individual whose domicile is in this state and to whom this	140
section applies, shall be reduced for any tax year for which an	141
application for such reduction has been approved, provided the	142
individual did not acquire ownership from a person, other than the	143
individual's spouse, related by consanguinity or affinity for the	144
purpose of qualifying for the reduction. An owner includes a	145
settlor of a revocable or irrevocable inter vivos trust holding	146
the title to a manufactured or mobile home occupied by the settlor	147
as of right under the trust.	148

(1) For manufactured and mobile homes for which the tax	149
imposed by section 4503.06 of the Revised Code is computed under	150
division (D)(2) of that section, the reduction shall equal one of	151
the following amounts, as applicable to the person:	152

(a) If the person received a reduction under this section for	153
tax year 2007, the greater of the reduction for that tax year or	154
the amount computed under division (B)(2) of this section;	155

(b) If the person received, for any homestead, a reduction	156
under this section for tax year 2014 or under division (A) of	157
section 323.152 of the Revised Code for tax year 2013, the amount	158
computed under division (B)(2) of this section. For purposes of	159
divisions (B)(1)(b) and (c) of this section, a person receives a	160
reduction under this section or division (A) of section 323.152 of	161
the Revised Code for tax year 2014 or 2013, respectively, if the	162
person files a late application for that respective tax year that	163
is approved by the county auditor under section 4503.066 or	164
323.153 of the Revised Code.	165

(c) If the person did not receive a reduction under this	166
section for tax year 2014 or under division (A) of section 323.152	167
of the Revised Code for tax year 2013 and the person's total	168
income does not exceed thirty thousand dollars, as adjusted under	169
division (B)(5) of this section, the amount computed under	170
division (B)(2) of this section.	171

(2) The amount of the reduction under division (B)(2) of this	172
section equals the product of the following:	173

(a) Twenty-five thousand dollars of the true value of the	174
property in money;	175

(b) The assessment percentage established by the tax	176
commissioner under division (B) of section 5715.01 of the Revised	177
Code, not to exceed thirty-five per cent;	178

(c) The effective tax rate used to calculate the taxes	179
charged against the property for the current year, where	180
"effective tax rate" is defined as in section 323.08 of the	181
Revised Code;	182

(d) The quantity equal to one minus the sum of the percentage	183
reductions in taxes received by the property for the current tax	184
year under section 319.302 of the Revised Code and division (B) of	185
section 323.152 of the Revised Code.	186

(3) For manufactured and mobile homes for which the tax	187
imposed by section 4503.06 of the Revised Code is computed under	188
division (D)(1) of that section, the reduction shall equal one of	189
the following amounts, as applicable to the person:	190

(a) If the person received a reduction under this section for	191
tax year 2007, the greater of the reduction for that tax year or	192
the amount computed under division (B)(4) of this section;	193

(b) If the person received, for any homestead, a reduction	194
under this section for tax year 2014 or under division (A) of	195
section 323.152 of the Revised Code for tax year 2013, the amount	196
computed under division (B)(4) of this section. For purposes of	197
divisions (B)(3)(b) and (c) of this section, a person receives a	198
reduction under this section or under division (A) of section	199
323.152 of the Revised Code for tax year 2014 or 2013,	200
respectively, if the person files a late application for a refund	201
of overpayments for that respective tax year that is approved by	202
the county auditor under section 4503.066 of the Revised Code.	203

(c) If the person did not receive a reduction under this	204
section for tax year 2014 or under division (A) of section 323.152	205
of the Revised Code for tax year 2013 and the person's total	206
income does not exceed thirty thousand dollars, as adjusted under	207
division (B)(5) of this section, the amount computed under	208
division (B)(4) of this section.	209

(4) The amount of the reduction under division (B)(4) of this	210
section equals the product of the following:	211

(a) Twenty-five thousand dollars of the cost to the owner, or	212
the market value at the time of purchase, whichever is greater, as	213
those terms are used in division (D)(1) of section 4503.06 of the	214
Revised Code;	215

(b) The percentage from the appropriate schedule in division	216
(D)(1)(b) of section 4503.06 of the Revised Code;	217

(c) The assessment percentage of forty per cent used in	218
division (D)(1)(b) of section 4503.06 of the Revised Code;	219

(d) The tax rate of the taxing district in which the home has	220
its situs.	221

(5) Each calendar year, the tax commissioner shall adjust the	222
income threshold described in divisions (B)(1)(c) and (B)(3)(c) of	223
this section by completing the following calculations in September	224
of each year:	225

(a) Determine the percentage increase in the gross domestic	226
product deflator determined by the bureau of economic analysis of	227
the United States department of commerce from the first day of	228
January of the preceding calendar year to the last day of December	229
of the preceding calendar year;	230

(b) Multiply that percentage increase by the total income	231
threshold for the ensuing tax year;	232

(c) Add the resulting product to the total income threshold	233
for the ensuing tax year;	234

(d) Round the resulting sum to the nearest multiple of one	235
hundred dollars.	236

The commissioner shall certify the amount resulting from the	237
adjustment to each county auditor not later than the first day of	238
December each year. The certified amount applies to the second	239
ensuing tax year. The commissioner shall not make the adjustment	240
in any calendar year in which the amount resulting from the	241
adjustment would be less than the total income threshold for the	242
ensuing tax year.	243

(C) If the owner or the spouse of the owner of a manufactured	244
or mobile home is eligible for a homestead exemption on the land	245
upon which the home is located, the reduction to which the owner	246
or spouse is entitled under this section shall not exceed the	247
difference between the reduction to which the owner or spouse is	248
entitled under division (B) of this section and the amount of the	249
reduction under the homestead exemption.	250

(D) No reduction shall be made with respect to the home of	251
any person convicted of violating division (C) or (D) of section	252
4503.066 of the Revised Code for a period of three years following	253
the conviction.	254

Section 2. That existing sections 323.152 and 4503.065 of the	255
Revised Code are hereby repealed.	256

Section 3. That Section 803.80 of Am. Sub. H.B. 59 of the	257
130th General Assembly be amended to read as follows:	258

Sec. 803.80. (A) The amendment by ~~this act~~Am. Sub. H.B. 59	259
of the 130th General Assembly of ~~divisions (A)(26) and (GG) of~~	260
~~section 5747.01,~~ section 5747.022 by adding the last sentence	261
thereto, and of division (A) of section 5747.025 of the Revised	262
Code applies to taxable years beginning on or after January 1,	263
2014.	264

(B) The amendment by ~~this act~~Am. Sub. H.B. 59 of the 130th	265
General Assembly of divisions (A)(26), (29), (31), and (GG) of	266
section 5747.01, the first sentence of section 5747.022, division	267
(C) of section 5747.025, and of sections 5747.02, 5747.05,	268
5747.08, 5747.21, 5747.22, and 5748.01 and the repeal of section	269
5747.211 of the Revised Code apply to taxable years beginning on	270
or after January 1, 2013.	271

Section 4. That existing Section 803.80 of Am. Sub. H.B. 59	272
of the 130th General Assembly is hereby repealed.	273

Section 5. (A) As used in this section:

274

(1) "Qualified certificate holder" means a certificate holder	275
that has a taxable year that ended in 2012 on any day other than	276
December 31, 2012.	277

(2) "Certificate holder" has the same meaning as in section	278
149.311 of the Revised Code.	279

(3) "Taxable year" and "tax year" have the same meanings as	280
in section 5733.04 of the Revised Code.	281

(B) A qualified certificate holder of a rehabilitation tax	282
credit certificate issued on or before December 31, 2012, that	283
authorizes the holder to claim a credit under section 5733.47 of	284
the Revised Code for tax years after tax year 2013 may claim that	285
credit at any time before December 31, 2013, on forms and in the	286
method prescribed in Chapter 5733. of the Revised Code applicable	287
to tax years prior to tax year 2014.	288

Section 6. The amendment by this act of sections 323.152 and	289
4503.065 of the Revised Code is not intended to supersede the	290
amendment to those sections by H.B. 72 of the 130th General	291
Assembly or to change the effective date of those amendments.	292

Section 7. This act is hereby declared to be an emergency	293
measure necessary for the immediate preservation of the public	294
peace, health, and safety. The reason for such necessity is to	295
ensure that a previously enacted tax deduction and credit be	296
available before the close of the current tax period. Therefore,	297
this act shall go into immediate effect.	298