CLAYTON聽鈥 狐狸视频 County is considering a property tax freeze for seniors, but the relatively simple idea has big implications 鈥 and it raised questions among officials and residents during debate this week.
Here are seven questions about the bill answered.
What's the new law?
Gov. Mike Parson earlier this month聽signed聽Senate Bill 190, which allows counties to provide a tax credit to seniors who are eligible for Social Security, own their home, use it as their primary residence and are required to make tax payments on that home. Eligible seniors would be exempt from increases in the amount of property taxes they owe.
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A county can put the plan in place with an ordinance or by voter approval. 狐狸视频 County is the first in Missouri to consider enacting it.
Will people who don't pay into Social Security be eligible for the tax credit?
It's not yet clear. Opponents of the bill have questioned whether full-time teachers would be eligible for the tax credit because they aren't entitled to Social Security coverage in Missouri. Railroad workers are also exempt from Social Security.
But state Rep. Ben Keathley of Chesterfield, who sponsored the legislation in the House, said teachers will be eligible as long as they meet the minimum age requirement for Social Security benefits 鈥 62.
Linda Quinley, senior director of school finance for the Missouri School Boards' Association, isn't so sure.
"The bill itself says 'is eligible for Social Security,'" but doesn't say anything about age, Quinley said.
How do taxpayers get the credit?
It depends. Counties will control how they provide the credit, according to Dennis Ganahl, managing director of Missouri Tax Relief Now. The group worked on the bill with the Legislature and is now urging 狐狸视频 County Council to pass its version ().
The amount of the credit would be noted on tax statements county collectors send to taxpayers. But counties can choose how to deliver the benefit 鈥 whether they apply it upfront to a tax bill, apply the credit the following year, or the county could have a taxpayer pay the full amount and send them a check later, Ganahl said.
It will also be up to counties to decide how they will determine a taxpayer is eligible, such as through an application.
Won't the Hancock Amendment protect school districts from losing revenue?
Sort of. Missouri's Hancock Amendment allows local governments to recoup decreased revenue by increasing tax levies. But under SB 190, counties would have to report the tax credit as revenue collected 鈥 meaning they couldn't roll up their tax levies to make up for the lost revenue, according to by the state Legislature's research division.
The law's design prevents the full tax burden from being passed on to younger homeowners.
School districts will still be able to roll up their levies according to the latest consumer price index or 5%, whichever is less, under the Hancock Amendment, Ganahl said. But that increase likely won't cover the full amount of lost revenue.
School districts will miss out on increases desperately needed to give teachers raises, school district advocates have said.
Isn't there another program in Missouri to give tax breaks to seniors?
Yes. Missouri's "circuit breaker" program is meant to help seniors and people with disabilities afford property taxes or rent. But there are strict limits on eligibility.
Single renters can't earn more than $27,500 annually, or $29,500 if they're married. And single homeowners have to earn less than $30,000, or $34,000 if they're married. The maximum annual credit is $750 for renters and $1,100 for homeowners.
But the eligibility requirements haven't been updated since 2008. Before that, they weren't updated since the program first went into effect in 1973.
And only the poorest of the poor qualify for the maximum amount 鈥 the average credit was $602 in 2021, according to an analysis by the聽, a left-leaning policy group.
The program, paid for by the state, needs updating if it's going to remain relevant, the group argued in its analysis, published in January. Missouri Tax Reform Now agrees.
"There are so few people who can take advantage of it now that you may as well not have it," Ganahl said.
What happens if 狐狸视频 County doesn't enact the plan?
County voters could put the plan in place through a ballot measure. Advocates would have to collect signatures from at least 5% of the number of people who voted in the 2020 gubernatorial election. A majority vote would enact the plan.
Will eligible taxpayers still be allowed to appeal their assessments?
Yes. Eligible taxpayers can still appeal with the county to reduce their property assessments.
The law wouldn't change the way the assessor values or calculates real estate, said Sarah Siegel of the 狐狸视频 County assessor's office 鈥 it would only freeze the amount they owe, she said. The county assessor would still assess the value according to Missouri law, and taxpayers would still receive the same assessment notices.聽
The county Collector of Revenue would factor in the freeze, and calculate the amount of taxes an eligible homeowner must pay.聽