State SealARIZONA HOUSE OF REPRESENTATIVES

 

SB 1268: class six property; elderly homeowners

PRIME SPONSOR: Senator Burges, LD 22

BILL STATUS: Ways & Means

 

Legend: DOR – Department of Revenue LPV – Limited property value Amendments – BOLD and Stricken (Committee)

Abstract

☐ Prop 105 (45 votes) ☐ Prop 108 (40 votes) ☐ Emergency (40 votes) ☐ Fiscal NoteRelating to classification of property.

Provisions

1.       Establishes that class three property owned by a taxpayer who qualifies for property valuation protection, uses the property as a primary residence and does not directly own or have interest in any other real property, is to be taxed as class six property. (Sec. 1)

2.       Establishes the proposed Act will be cited as "Senior Citizen and Veteran Tax Relief Act." (Sec. 2)

3.       Makes technical changes. (Sec. 1)  

Current Law

An Arizona resident who is 65 or older may apply for a property valuation protection option on his or her primary residence. To qualify, the person must have resided on the property for at least two years, and the applicant's total income must not exceed the supplemental security income benefit rate by: either 400% if one person owns the property, or 500% if two or more people own the property. If the county assessor approves a property valuation protection option, the full cash value of the primary residence is fixed. To remain eligible, qualifying residents must apply every three years (Article IX, Sec 18, Constitution of Arizona).

A property's tax liability depends on: the LPV determined by the county assessor or DOR, the assessment ratio based on the legal classification of property, and the tax rate set by the taxing jurisdiction. There are nine legal classifications of property with ratios ranging from 1-18%. Class three property has a 10% assessment ratio and consists of primary residential property which may be up to 10 acres of land unless zoned exclusively for residential purposes or if it contains legal restrictions or physical conditions that prevent the division of the parcel, in which the property may be up to 40 acres of land. Class six property has a 5% assessment ratio and consists of noncommercial historic property, property located in a foreign trade, military reuse or enterprise zone and  property of a qualified environmental technology manufacturing facility (A.R.S. § 42-12003), (JLBC).

 

 

 

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Fifty-third Legislature                  SB 1268

Second Regular Session                               Version 1: Ways & Means

 

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