Pennsylvania Act 1996-91 — CITIES OF FIRST CLASS - REAL PROPERTY TAXES

Act text

CITIES OF FIRST CLASS - REAL PROPERTY TAXES
                  Act of Jul. 2, 1996, P.L. 529, No. 91               Cl. 72
                                  AN ACT

     Implementing the provisions of section 2(b)(ii) of Article VIII
        of the Constitution of Pennsylvania by authorizing cities of
        the first class to provide for special tax provisions
        relating to real property taxes for certain persons who meet
        the established standards and qualifications for age and
        poverty.

        The General Assembly of the Commonwealth of Pennsylvania
     hereby enacts as follows:

     Section 1.  Construction.
        This act shall be construed to authorize the governing bodies
     of cities of the first class to provide by ordinance for the
     implementation of the special tax provisions contained in this
     act which allow for the refund or forgiveness of real property
     tax liability of certain low-income senior citizens attributable
     to real property tax rate increases and increases in the
     assessed value of the low-income senior citizen's homestead,
     thereby implementing section 2(b)(ii) of Article VIII of the
     Constitution of Pennsylvania.
     Section 2.  Declaration of policy.
            (1)  In recognition of the powers contained in section
        2(b)(ii) of Article VIII of the Constitution of Pennsylvania
        which provides therein for the establishing as a class or
        classes of subjects of taxation the property or privileges of
        persons who, because of poverty or age, are determined to be
        in need of special tax provisions, it is the legislative
        intent and purpose of this act to implement the powers under
        such constitutional provision by establishing special tax
        provisions for a class of persons within cities of the first
        class as provided in this act.
            (2)  Having determined that there are persons within
        cities of the first class of this Commonwealth whose incomes
        are such that the governing bodies of cities of the first
        class may decide that the imposition of the full amount of
        real estate taxes on these persons deprives them and their
        dependents of the bare necessities of life and having further
        determined that poverty is a relative concept inextricably
        joined with actual income, the number of persons dependent
        upon such income and the unlikelihood of a taxpayer being
        able by reason of age to increase that income, it is deemed
        to be a matter of public policy to provide special tax
        provisions for that class of persons designated in this act
        within cities of the first class to enable governing bodies
        of cities of the first class to by ordinance relieve their
        economic burden.
     Section 3.  Definitions.
        The following words and phrases when used in this act shall
     have the meanings given to them in this section unless the
     context clearly indicates otherwise:
        "Dependent."  A child who derives more than one-half of the
     child's total support during the entire taxable year from a
     taxpayer eligible for the special tax provisions of this act.
     Any person who is a dependent pursuant to the provisions of the
     Internal Revenue Code of 1986 (Public Law 99-514, 26 U.S.C. § 1
     et seq.) during a taxable year shall prima facie be deemed a
     dependent for the purpose of this act.
        "Homestead."  A dwelling used as a home, occupied by a
     taxpayer as a primary residence. The term includes, but is not
     limited to, mobile homes which are assessed as realty for local
     property tax purposes and the land upon which the mobile home is
     situated and other similar living accommodations as well as a
     part of a multidwelling or multipurpose building and a part of
     the land upon which it is built to the extent that the eligible
     taxpayer is chargeable by a city of the first class for property
     taxes. The term also includes, but is not limited to, premises
     occupied by an eligible taxpayer if he is required by law to pay
     a property tax by reason of his ownership or rental of,
     including a possessory interest in, the dwelling, the land or
     both. The term "by law" shall not be deemed to include a
     contractual obligation between the eligible taxpayer and a
     person who would otherwise be responsible to a city of the first
     class for the payment of the tax. An owner includes a person in
     possession under contract of sale, deed of trust, life estate,
     joint tenancy or tenancy in common.
        "Income."  All income from whatever source derived,
     including, but not limited to, salaries, wages, bonuses,
     commissions, income from self-employment, alimony, support
     money, cash public assistance and relief, the net amount of any
     pensions or annuities, including railroad retirement benefits,
     all benefits received under the Social Security Act (49 Stat.
     620, 42 U.S.C. § 301 et seq.), except Medicare benefits, all
     benefits received under State employment insurance laws and
     veterans' disability payments, all interest received from the
     Federal or any state government, or any instrumentality or
     political subdivision thereof, realized capital gains, net
     income from rentals, workers' compensation and the gross amount
     of loss of time insurance benefits, life insurance benefits and
     proceeds, except the first $10,000 of the total of death benefit
     payment, and gifts of cash or property, other than transfers by
     gift between members of a household, in excess of a total value
     of $500, but shall not include surplus food or other relief in
     kind supplied by a governmental agency or property tax rebate.
        "Low-income taxpayer."  A taxpayer whose income does not
     exceed the maximum annual income allowable for an eligible
     claimant to participate in the Commonwealth's program for
     pharmaceutical assistance for the elderly, pursuant to the act
     of August 14, 1991 (P.L.342, No.36), known as the Lottery Fund
     Preservation Act.
        "Poverty."  An economic condition wherein the total amount of
     household income is insufficient to adequately provide the
     taxpayer, the taxpayer's spouse and dependent children with the
     necessities of life. For the purpose of determining eligibility
     for the tax exemptions and special tax provisions of this act, a
     taxpayer is deemed to be living at the poverty level if the
     taxpayer meets the low-income provisions defined under this act.
        "Real estate taxes."  All taxes on a homestead imposed or
     authorized to be imposed for cities of the first class and
     school districts of the first class.
        "Senior citizen."  A taxpayer who is 65 years of age or older
     or whose spouse, if a member of the household, is 65 years of
     age or older during a calendar year in which real property taxes
     are due and payable or was a widow or widower of someone who was
     65 years of age or older and was 50 years of age or older during
     a calendar year or part thereof in which real estate taxes were
     due and payable. The term "widow" or "widower" shall mean the
     surviving wife or the surviving husband, as the case may be, of
     a deceased individual who has not remarried.
        "Special tax provision."  The standards and qualifications
     provided under this act to establish the eligibility for and the
     refund or forgiveness of a portion of the taxpayer's real estate
     tax liability.
     Section 4.  Special tax provisions; refund or forgiveness of
                    real estate taxes.
        (a)  General rule.--Any taxpayer within a city of the first
     class who meets the standards and qualifications established by
     this act shall be deemed a separate class of subjects of
     taxation, and, as such, each governing body of a city of the
     first class may by ordinance provide that such taxpayers shall
     be entitled to the benefit of the special tax provisions of this
     act.
        (b)  Refund or forgiveness of real estate taxes.--Pursuant to
     the provisions of such ordinance, eligible taxpayers shall be
     entitled to a refund or forgiveness which have been paid over to
     or would, except for the provisions of this act, be payable to
     cities of the first class and school districts of the first
     class for real estate taxes authorized or imposed for city and
     school district purposes in accordance with the following
     provisions:
            (1)  Low-income senior citizens taxpayers shall be
        entitled to receive refunds or forgiveness of that part of
        their real estate tax liability attributable to any real
        estate tax rate increase or an increase in the assessed value
        of the taxpayer's homestead occurring after the effective
        date of any ordinance implementing this act.
            (2)  In the event that a taxpayer who had previously been
        eligible to receive refunds or forgiveness of taxes as
        authorized by this act is no longer eligible by reason of
        failing to meet the low-income requirement provided under
        this act, the taxpayer shall be billed and shall pay real
        estate taxes at the then current real estate tax rate and
        assessed value. If for subsequent tax years a taxpayer
        reestablishes eligibility for refunds or forgiveness of real
        estate taxes by again meeting the low-income requirements
        provided under this act, the amount of real estate taxes that
        the taxpayer is eligible to have refunded or forgiven is that
        part of their real estate tax liability attributable to any
        real estate tax rate increase or an increase in the assessed
        value of the taxpayer's homestead occurring no earlier than
        the calendar year prior to the tax year for which the
        taxpayer reestablishes eligibility.
            (3)  The maximum amount of real estate taxes which may be
        refunded or forgiven may be limited by ordinance.
            (4)  If a homestead is owned for only a portion of a year
        or is owned in part by a person who is not a low-income
        taxpayer, the tax collector shall apportion the real estate
        taxes in accordance with the period or portion of ownership
        of the eligible taxpayer in determining the amount of refund
        or forgiveness for which a taxpayer is eligible.
     Section 5.  Application; proof of claim.
        (a)  Application.--Any person desiring to take advantage of
     the special tax provisions pursuant to ordinance adopted under
     this act shall notify each city of the first class granting the
     special tax provisions in writing on a form provided by it
     submitted at the time provided in the ordinance or regulation.
     Only one taxpayer for each homestead shall be entitled to the
     real estate tax refund or forgiveness of taxes. If two or more
     persons residing at any homestead meet the qualification for a
     real estate tax refund or forgiveness of taxes, they may
     determine among themselves who shall receive the refund or
     forgiveness of taxes. If they are unable to agree, each city of
     the first class shall determine to whom the refund or
     forgiveness of taxes is to apply.
        (b)  Proof of claim.--Each application shall include
     reasonable proof of household income, the location and nature of
     the property claimed as a homestead and the tax bill or receipt
     for the real estate taxes owed or paid in connection with the
     occupancy of the homestead. It shall not be necessary that real
     estate taxes are paid directly by the taxpayer. The first
     application filed shall include proof that the taxpayer or the
     taxpayer's spouse is or will be 65 years of age or older during
     the calendar year in which real estate taxes are due and
     payable.
     Section 6.  Administration and enforcement.
        Each city of the first class shall provide by ordinance, rule
     or regulation for the administration and enforcement of any
     ordinance adopted pursuant to this act as is provided by law.
     Section 7.  Effective date.
        This act shall take effect immediately.