FINAL BILL REPORT

SHB 695

                                  C 301 L 87

BYHouse Committee on Ways & Means/Revenue (originally sponsored by Representatives Hine, Bristow, Barnes, Unsoeld, Sayan, Todd, Allen, Madsen, J. Williams, Sanders, C. Smith, Baugher, Kremen, May, Brough, Rasmussen, Betrozoff and Rayburn)

Changing provisions relating to property tax exemptions for seniors and disabled persons.

House Committe on Ways & Means/Revenue

Senate Committee on Ways & Means

SYNOPSIS AS ENACTED

BACKGROUND:

Qualifying senior citizens and disabled persons are entitled to a property tax exemption for various parts of regular and special levies.

General qualifications are:  1) 61 years of age or older on January 1 of the year in which the exemption claim is filed; or 2) retired from regular employment by reason of physical disability, provided that a surviving spouse of a person qualified at time of death if the spouse is at least 57 years old and is otherwise qualified; 3) exemptions apply to the "principal" residence provided that any person who sells, transfers, or is displaced from a residence may transfer the exemption to another residence but the exemption applies to only one residence at a time; and 4) the person claiming the exemption must have owned the residence.  Marital community or ownership by cotenants is deemed a life estate.

The income test is based on "combined disposable income" of a household which includes adjusted gross income plus capital gains, deductions for loss, depreciation, pensions and annuities, military pay, veterans benefits, social security and railroad retirement, dividends and state and municipal bond income.

Exemptions are:  1) a household with combined disposable income of $15,000 or less is exempt from all excess levies;  2) a household with combined disposable income of $12,000 or less but greater than $9,000 is exempt from all regular levies on the greater of $20,000 in value or 30 percent of the total value of the residence not to exceed $40,000; and 3) a household with combined disposable income of $9,000 or less is exempt from all regular levies on the greater of $25,000 in value or 50 percent of total value.

SUMMARY:

The income and assessed valuation thresholds for senior citizen property tax exemptions are increased for taxes due in 1989.

The $15,000 income threshold for exemption from excess property tax levies is increased to $18,000.

The $12,000 income threshold is changed to $14,000 and the $9,000 income threshold is changed to $12,000.  Persons qualifying with these income thresholds are exempt from regular property tax levies on $24,000 of assessed valuation or 30 percent of the total value not to exceed $40,000.

The households qualifying with income under the $12,000 threshold will be exempt from regular property tax levies on $28,000 of assessed valuation or 50 percent of total value.

VOTES ON FINAL PASSAGE:

      House 96   1

      Senate    41     0 (Senate amended)

      House 93   1 (House concurred)

EFFECTIVE:July 26, 1987