Effective Date of Rule: Thirty-one days after filing.
Purpose: WAC 458-16A-100 is being amended to conform to SSHB [2SHB] 3104 (chapter 6, Laws of 2008), SSB 5256 (chapter 182, Laws of 2008), and legislation since 2003.
Citation of Existing Rules Affected by this Order: Amending WAC 458-16A-100 Senior citizen and disabled person exemption -- Definitions.
Statutory Authority for Adoption: RCW 84.36.383, 84.36.389, and 84.36.865.
Adopted under notice filed as WSR 08-11-079 on May 19, 2008.
Number of Sections Adopted in Order to Comply with Federal Statute: New 0, Amended 0, Repealed 0; Federal Rules or Standards: New 0, Amended 0, Repealed 0; or Recently Enacted State Statutes: New 0, Amended 1, Repealed 0.
Number of Sections Adopted at Request of a Nongovernmental Entity: New 0, Amended 0, Repealed 0.
Number of Sections Adopted on the Agency's Own Initiative: New 0, Amended 0, Repealed 0.
Number of Sections Adopted in Order to Clarify, Streamline, or Reform Agency Procedures: New 0, Amended 0, Repealed 0.
Number of Sections Adopted Using Negotiated Rule Making: New 0, Amended 0, Repealed 0; Pilot Rule Making: New 0, Amended 0, Repealed 0; or Other Alternative Rule Making: New 0, Amended 1, Repealed 0.
Date Adopted: July 31, 2008.
Janis P. Bianchi
Technical Advice Division
AMENDATORY SECTION(Amending WSR 03-09-002, filed 4/2/03, effective 5/3/03)
WAC 458-16A-100 Senior citizen ((
and)), disabled person,
and one hundred percent disabled veteran
exemption -- Definitions.
(1) Introduction. This rule contains
definitions of the terms used for the senior citizen (( and)),
disabled person, and one hundred percent disabled veteran
exemption from property taxes. The definitions apply to the
senior citizen (( and)), disabled person, and one hundred
percent disabled veteran exemption contained in sections RCW 84.36.381 through 84.36.389 unless the context clearly
(2) Annuity. "Annuity" means a series of payments under a contract. Annuity contracts pay a fixed sum of money at regular intervals for more than one full year. An annuity may be paid as the proceeds of a life insurance contract (other than as a lump sum payment), unemployment compensation, disability payments, or even welfare receipts. It does not include payments for the care of dependent children.
(3) Assessment year. "Assessment year" means the year
when the assessor lists and values the principal residence for
property taxes. The assessment year is the calendar year
prior to the year the taxes become due and payable. It is
always the year before the claimant receives a reduction in
his or her property taxes because of the senior citizen
and)), disabled person, and one hundred percent disabled
(4) Capital gain. "Capital gain" means the amount the seller receives for property (other than inventory) over that seller's adjusted basis in the property. The seller's initial basis in the property is the property's cost plus taxes, freight charges, and installation fees. In determining the capital gain, the seller's costs of transferring the property to a new owner are also added onto the adjusted basis of the property. If the property is acquired in some other manner than by purchase, the seller's initial basis in the property is determined by the way the seller received the property (e.g., property exchange, payment for services, gift, or inheritance). The seller adjusts (increases and decreases) the initial basis of the property for events occurring between the time the property is acquired and when it is sold (e.g., increased by the cost of improvements made later to the property).
(5) Claimant. "Claimant" means a person claiming the
senior citizen ((
and)), disabled person, and one hundred
percent disabled veteran exemption by filing an application
with the county assessor in the county where the property is
(6) Combined disposable income. "Combined disposable income" means the annual disposable income of the claimant, the claimant's spouse or domestic partner, and any cotenant reduced by amounts paid by the claimant or the claimant's spouse or domestic partner for their:
(a) Legally prescribed drugs;
(b) Home health care; ((
(c) Nursing home ((
expenses)), boarding home, or adult
family home expenses; and
(d) Health care insurance premiums for Medicare under Title XVIII of the Social Security Act.
Disposable income is not reduced by these amounts if payments are reimbursed by insurance or a government program (e.g., Medicare or Medicaid). When the application is made, the combined disposable income is calculated for the assessment year.
(7) Cotenant. "Cotenant" means a person who resides with the claimant and who has an ownership interest in the residence.
(8) Department. "Department" means the state department of revenue.
(9) Depreciation. "Depreciation" means the annual deduction allowed to recover the cost of business or investment property having a useful life of more than one year. In limited circumstances, this cost, or a part of this cost, may be taken as a section 179 expense on the federal income tax return in the year business property is purchased.
(10) Disability. "Disability" means the inability to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or which has lasted or can be expected to last for a continuous period of not less than twelve months. (RCW 84.36.383(7); 42 U.S.C. Sec. 423 (d)(1)(A).)
(11) Disabled veteran. "Disabled veteran" means a veteran of the armed forces of the United States with a one hundred percent disability rating that is service-connected (RCW 84.36.381 (3)(b)).
(12) Disposable income. "Disposable income" means the adjusted gross income as defined in the Federal Internal Revenue Code of 2001, and as amended after that date, plus all the other items described below to the extent they are not included in or have been deducted from adjusted gross income. (RCW 84.36.383)
(a) Capital gains, other than gain excluded from the sale of a principal residence that is reinvested prior to the sale or within the same calendar year in a different principal residence;
(b) Losses. Amounts deducted for loss;
(c) Depreciation. Amounts deducted for depreciation;
(d) Pension and annuity receipts;
(e) Military pay and benefits other than attendant-care and medical-aid payments. Attendant-care and medical-aid payments are any payments for medical care, home health care, health insurance coverage, hospital benefits, or nursing home benefits provided by the military;
(f) Veterans benefits other than:
(i) Attendant-care payments and medical-aid payments, defined as any payments for medical care, home health care, health insurance coverage, hospital benefits, or nursing home benefits provided by the Department of Veterans Affairs (VA);
(ii) Disability compensation, defined as payments made by the VA to a veteran because of service-connected disability;
(iii) Dependency and indemnity compensation, defined as payments made by the VA to a surviving spouse, child, or parent because of a service-connected death.
Attendant-care and medical-aid payments are any
payments for medical care, home health care, health insurance
coverage, hospital benefits, or nursing home benefits provided
by the Department of Veterans Affairs (VA);))
(g) Federal Social Security Act and railroad retirement benefits;
(h) Dividend receipts;
(i) Interest received on state and municipal bonds.
(11))) (13) Domestic partner. "Domestic partner" means
a person registered under chapter 26.60 RCW or a partner in a
legal union of two persons of the same sex, other than a
marriage, that was validly formed in another jurisdiction, and
that is substantially equivalent to a domestic partnership
under chapter 26.60 RCW.
(14) Domestic partnership. "Domestic partnership" means a partnership registered under chapter 26.60 RCW or a legal union of two persons of the same sex, other than a marriage, that was validly formed in another jurisdiction, and that is substantially equivalent to a domestic partnership under chapter 26.60 RCW.
(15) Excess levies. "Excess levies" means voter-approved levies by taxing districts, other than port or public utility districts, of additional taxes in excess of the statutory aggregate dollar rate limit, the statutory dollar rate limit, or the constitutional one percent levy limit. It does not include regular levies allowed to exceed a statutory limit with voter approval or voted regular levies.
(12))) (16) Excluded military pay or benefits.
"Excluded military pay or benefits" means military pay or
benefits excluded from a person's federal gross income, other
than those amounts excluded from that person's federal gross
income for attendant-care and medical-aid payments. Members
of the armed forces receive many different types of pay and
allowances. Some payments or allowances are included in their
gross income for the federal income tax while others are
excluded from their gross income. Excluded military pay or
(a) Compensation for active service while in a combat zone or a qualified hazardous duty area;
(b) Death allowances for burial services, gratuity payment to a survivor, or travel of dependents to the burial site;
(c) Moving allowances;
(d) Travel allowances;
(e) Uniform allowances;
(f) Group term life insurance payments made by the military on behalf of the claimant, the claimant's spouse or domestic partner, or the cotenant; and
(g) Survivor and retirement protection plan premiums paid by the military on behalf of the claimant, the claimant's spouse or domestic partner, or the cotenant.
(13))) (17) Family dwelling unit. "Family dwelling
unit" means the dwelling unit occupied by a single person, any
number of related persons, or a group not exceeding a total of
eight related and unrelated nontransient persons living as a
single noncommercial housekeeping unit. The term does not
include a boarding or rooming house.
(14))) (18) Home health care. "Home health care" means
the treatment or care of either the claimant or the claimant's
spouse or domestic partner received in the home. It must be
similar to the type of care provided in the normal course of
treatment or care in a nursing home, although the person
providing the home health care services need not be specially
licensed. The treatment and care must meet at least one of
the following criteria. It must be for:
(a) Medical treatment or care received in the home;
(b) Physical therapy received in the home;
(c) Food, oxygen, lawful substances taken internally or applied externally, necessary medical supplies, or special needs furniture or equipment (such as wheel chairs, hospital beds, or therapy equipment), brought into the home as part of a necessary or appropriate in-home service that is being rendered (such as a meals on wheels type program); or
(d) Attendant care to assist the claimant, or the claimant's spouse or domestic partner, with household tasks, and such personal care tasks as meal preparation, eating, dressing, personal hygiene, specialized body care, transfer, positioning, ambulation, bathing, toileting, self-medication a person provides for himself or herself, or such other tasks as may be necessary to maintain a person in his or her own home, but shall not include improvements or repair of the home itself.
(15))) (19) Lease for life. "Lease for life" means a
lease that terminates upon the demise of the lessee.
(16))) (20) Legally prescribed drugs. "Legally
prescribed drugs" means drugs supplied by prescription of a
medical practitioner authorized to issue prescriptions by the
laws of this state or another jurisdiction.
(17))) (21) Life estate. "Life estate" means an estate
whose duration is limited to the life of the party holding it
or of some other person.
(a) Reservation of a life estate upon a principal residence placed in trust or transferred to another is a life estate.
(b) Beneficial interest in a trust is considered a life estate for the settlor of a revocable or irrevocable trust who grants to himself or herself the beneficial interest directly in his or her principal residence, or the part of the trust containing his or her personal residence, for at least the period of his or her life.
(c) Beneficial interest in an irrevocable trust is considered a life estate, or a lease for life, for the beneficiary who is granted the beneficial interest representing his or her principal residence held in an irrevocable trust, if the beneficial interest is granted under the trust instrument for a period that is not less than the beneficiary's life.
(18))) (22) Owned. "Owned" includes "contract
purchase" as well as "in fee," a "life estate," and any "lease
for life." A residence owned by a marital community or
domestic partnership or owned by cotenants is deemed to be
owned by each spouse or each domestic partner or each
(19))) (23) Ownership by a marital community or
domestic partnership. "Ownership by a marital community or
domestic partnership" means property owned in common by both
spouses or domestic partners. Property held in separate
ownership by one spouse or domestic partner is not owned by
the marital community or domestic partnership. The person
claiming the exemption must own the property for which the
exemption is claimed. Example: A person qualifying for the
exemption by virtue of age (( or)), disability, or one hundred
percent disabled veteran status cannot claim exemption on a
residence owned by the person's spouse or domestic partner as
a separate estate outside the marital community or domestic
partnership unless the claimant has a life estate therein.
(20))) (24) Pension. "Pension" means an agreement to
provide for payments, not wages, to a person (or to that
person's family) who has fulfilled certain conditions of
service or reached a certain age. A pension may allow payment
of all or a part of the entire pension benefit, in lieu of
regular periodic payments.
(21) Physical disability. "Physical disability" means
the condition of being disabled, resulting in the inability to
pursue an occupation because of physical or mental impairment.
(22))) (25) Principal residence. "Principal residence" means the claimant owns and occupies the residence as his or her principal or main residence. It does not include a residence used merely as a vacation home. For purposes of this exemption:
(a) Principal or main residence means the claimant occupies the residence for more than six months each year.
(b) Confinement of the claimant to a hospital or nursing home does not disqualify the claim for exemption if:
(i) The residence is temporarily unoccupied;
(ii) The residence is occupied by the claimant's spouse or domestic partner or a person financially dependent on the claimant for support;
(iii) The residence is occupied by a caretaker who is not paid for watching the house;
(iv) The residence is rented for the purpose of paying
nursing home ((
or)), hospital, boarding home or adult family
(23))) (26) Regular gainful employment. "Regular
gainful employment" means consistent or habitual labor or
service which results in an increase in wealth or earnings.
(24))) (27) Replacement residence. "Replacement
residence" means a residence that qualifies for the senior
citizen (( and)), disabled person, and one hundred percent
disabled veteran exemption and replaces the prior residence of
the (( senior citizen or disabled)) person receiving the
(25))) (28) Residence. "Residence" means a
single-family dwelling unit whether such unit be separate or
part of a multiunit dwelling and includes up to one acre of
the parcel of land on which the dwelling stands, and it
includes any additional property up to a total of five acres
that comprises the residential parcel if land use regulations
require this larger parcel size. The term also includes:
(a) A share ownership in a cooperative housing association, corporation, or partnership if the person claiming exemption can establish that his or her share represents the specific unit or portion of such structure in which he or she resides.
(b) A single-family dwelling situated upon leased lands and upon lands the fee of which is vested in the United States, any instrumentality thereof including an Indian tribe, the state of Washington, or its political subdivisions.
(c) A mobile home which has substantially lost its identity as a mobile unit by being fixed in location upon land owned or rented by the owner of said mobile home and placed on a foundation, posts, or blocks with fixed pipe connections for sewer, water or other utilities even though it may be listed and assessed by the county assessor as personal property. It includes up to one acre of the parcel of land on which a mobile home is located if both the land and mobile home are owned by the same qualified claimant.
(26))) (29) Veteran. "Veteran" means a veteran of the
armed forces of the United States.
(30) Veterans benefits. "Veterans benefits" means benefits paid or provided under any law, regulation, or administrative practice administered by the VA. Federal law excludes from gross income any veterans' benefits payments, paid under any law, regulation, or administrative practice administered by the VA.
[Statutory Authority: RCW 84.36.383, 84.36.389, and 84.36.865. 03-09-002, § 458-16A-100, filed 4/2/03, effective 5/3/03.]