The bill amends the Income Tax Act of 1967, specifically section 520, to update the criteria for claiming property tax credits for homesteads. It introduces a new eligibility threshold for the taxable value of a homestead, increasing it from $135,000 to $196,500, effective from the 2026 tax year. Additionally, the bill stipulates that this threshold will be adjusted annually based on the United States House Price Index. The language also clarifies that property taxes used for credit computation must not exceed the amount levied for one tax year and modifies the terminology from "person" to "claimant" throughout the section.

Furthermore, the bill revises the calculation of credits for renters, allowing them to claim credits based on a percentage of gross rent paid, and establishes provisions to prevent discrimination against renters who claim these credits. It also sets a maximum credit limit of $1,500 per year for tax years after 2018, with adjustments based on the Consumer Price Index starting from the 2021 tax year. The bill includes provisions for senior citizens, allowing them to claim credits based on their total household resources and rental payments, and mandates the department to create rules and forms to facilitate these claims.

Statutes affected:
House Introduced Bill: 206.520