Md. Code Regs. 18.07.01.02

Current through Register Vol. 51, No. 24, December 2, 2024

Section 18.07.01.02 - Criteria Adopted

The following criteria have been adopted by the Department in the processing of applications for the Homeowners' Tax Credit Program:

A. Curtilage.

(1) The amount of real property taxes eligible for credit consideration is calculated upon the curtilage, which shall include:

(a) The land occupied by the dwelling house and garage and assessed at a primary rate;

(b) The amount of any additional land insufficient in size according to local zoning requirements for another homesite and assessed at a lesser rate, excluding any agriculturally assessed land.

(2) The curtilage determined under §A(1) of this regulation shall be posted to the assessment field card by the local supervisor of assessments.

B. Dwelling House.

(1) The amount of real property taxes eligible for credit consideration shall be calculated on the curtilage as defined in §A(1) of this regulation and the dwelling house, which is used as the principal residence of a homeowner.

(2) A trailer may qualify as a dwelling house if it meets all of the following criteria:

(a) The trailer is the principal residence of its owner;

(b) The trailer is not located in a trailer park, as defined by local zoning ordinances, where an excise tax is collected by the local government under Article 24, § 9-401, Annotated Code of Maryland;

(c) The owner of the trailer is not paying a fee for the privilege of using the parking space as defined in Tax-Property Article, §8-234, Annotated Code of Maryland;

(d) The owner of the site upon which the trailer is located has established a separate property tax account for the site;

(e) The owner of the trailer receives a separate property tax bill for the trailer.

C. Combined Gross Income of All Persons Residing in the Home.

(1) An applicant shall report on the application the combined gross income of all persons residing in the home, if the persons are not dependents, or not paying reasonable fixed charges.

(2) An applicant who refuses to submit the information required under §C(1) of this regulation shall be denied a property tax credit.

D. Dependent. An applicant who claims a person is a dependent, but who does not file a federal income tax return, shall submit verification of the dependency status to the Department in the form of a sworn affidavit.

E. Reasonable Fixed Charges.

(1) A fixed charge reported by an applicant is considered reasonable if it equals one of the following amounts:

(a) A minimum weekly standard established by the Department;

(b) Ten percent of the nondependent occupant's gross income;

(c) Ten percent of the applicant's combined gross income;

(d) The aggregate of all individual expenses paid by the occupant to assist in the maintenance of the dwelling house;

(e) An amount the local supervisor of assessments or tax credit administrator finds sufficient in cases of extreme hardship.

(2) An applicant who does not state initially on the application form the amount of a reasonable fixed charge received from a person shall execute a sworn affidavit.

F. Total Income.

(1) Total income, whether taxable for federal or State income tax purposes or not, shall be reported on the tax credit application, and requires:

(a) The counting of 100 percent of capital gains and dividends;

(b) The disallowance of capital losses in excess of capital gains;

(c) The disallowance of depreciation as a business deduction;

(d) The disallowance of all federal adjustments to personal income except employee business expenses and the penalty for early withdrawal of savings.

(2) Total income does not include lump-sum life insurance payments, research grants, and Veterans Administration educational benefits.

G. Recovery of Tax Credits.

(1) The Department shall recover under Tax-Property Article, §9-104(o), Annotated Code of Maryland, the excess amount of credit granted in the following instances:

(2) The Department shall request repayment of the excess credit amount from the owner of the dwelling house and shall direct the local city or county treasurer to place a lien on the property if payment is not received.

(a) The dwelling house is sold before the end of the taxable year for which a credit was granted;

(b) The dwelling house is transferred to the heirs of an applicant before the end of the relevant taxable year;

(c) The dwelling house initially was granted an improper amount of tax credit as determined upon a post audit investigation;

(d) The homeowner dies before the end of the taxable year for which a credit was granted.

H. Timeliness of Application. The Department shall consider an application as timely under Tax-Property Article, §9-104(k), Annotated Code of Maryland, if the application is postmarked or received on or before the applicable date.

I. Illness or Need of Special Care. For purposes of Tax-Property Article, §9-104(j), Annotated Code of Maryland, "illness or need of special care" means that the applicant, spouse, or dependents are actually in need of ongoing medical treatment at a level which cannot be provided in the dwelling house.

Md. Code Regs. 18.07.01.02

Regulations .02 amended effective March 11, 1996 (23:5 Md. R. 384)