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Homeowners must apply for property-tax credit or lose it

Tens of thousands of Maryland homeowners who haven't already applied for the Homestead Property Tax Credit have until the end of the year to do so or lose the often-valuable break.

The deadline was set so long ago — 2007 — that some residents might not remember if they applied. State assessors, hoping to cut down on anxious calls, launched an online feature Monday that notes whether a property's application is in and processed.

"We get such tremendous volume of calls, and one of the unfortunate things is, when people do call … they sometimes get a busy signal," said Robert E. Young, director of the state Department of Assessments and Taxation. "It's so much easier just to go to the website."

The owners of 807,000 homes in the state are getting a break on their property taxes thanks to the homestead credit, which acts as a limit on annual increases. About 150,000 owners haven't sent in their applications, according to the assessments agency.

The statewide homestead program is only for primary residences. It keeps the amount of assessed value a homeowner is taxed on from increasing more than 10 percent a year, with even lower caps in most jurisdictions. The limit is 4 percent a year in Baltimore and Baltimore County, for instance.

The break can add up. Just in Baltimore, thousands of homeowners got at least half their property taxes forgiven by the homestead credit this tax year.

The flip side is that the homestead credit cost the city $120 million in foregone revenue this year alone — and for years the program has been plagued by owners taking the credit on rentals, boarded-up homes and other properties that weren't their main residence. The state revoked credits on more than 550 city homes this year after a Baltimore Sun investigation turned up many examples of owners "double-dipping" on two, three or even four homes.

Eligibility problems prompted the 2007 registration law. New buyers must apply for the credit within six months of purchase, while all others have until Dec. 31 of this year. This once-per-home process requires owners to submit their Social Security number so assessors can cross-check the addresses listed on income tax returns and drivers' licenses to verify that the properties are primary residences.

Assessors figure that some of the 150,000 homestead recipients who haven't applied yet aren't eligible for the credit. Applications require owners to acknowledge that they're submitting their information under penalty of perjury.

"That's a big variable — people who know they shouldn't be getting it, and they aren't going to apply," Young said. "They know that we're serious about that perjury oath."

To check the status of an application, homeowners can visit the assessments agency's website, dat.state.md.us, and type in their address on the Real Property Data Search page. (The direct link is sdatcert3.resiusa.org/rp_rewrite.) If the state received and processed a homestead application, that fact will be noted at the bottom of the property's page, Young said.

The state has received 766,000 applications so far, he said. That includes owners eligible for the homestead credit in the sense that they live in their homes, but who aren't receiving a break on their taxes this year because they don't qualify mathematically.

Homeowners who fail to apply in time to keep their credit will lose it in the tax year beginning July 1, 2013. But Young said those who miss the deadline can get their credit reinstated in 2014 — the amount they would have received that year if they had met the Dec. 31 deadline.

The assessments agency has tried to get the word out about the requirement by including applications in assessment notices and telling homeowners who call in on other subjects. Young said local governments also have indicated that they will include a notice in the tax bills going out in July.

Carl Cleary, housing coordinator at the Reservoir Hill Improvement Council in Baltimore, said housing counselors also can pass on the word. He wants to make sure no one loses their homestead credit because they didn't realize they have to apply.

"With the deadline coming, we could certainly help," he said.

jhopkins@baltsun.com

twitter.com/RealEstateWonk

Check your status

To check the status of an application, homeowners can visit the assessments agency's website, dat.state.md.us, and type in their address on the Real Property Data Search page. The direct link is sdatcert3.resiusa.org/rp_rewrite.

If the state received and processed a homestead application, that will be noted at the bottom of the property's page.

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