The bill amends the Income Tax Act of 1967, specifically section 508, to clarify definitions and conditions related to "gross rent" and "homestead." It establishes that "gross rent" refers to the total rent agreed upon in an arms-length transaction between the landlord and tenant. If the landlord and tenant do not engage in an arms-length transaction and the rent is deemed excessive, the department has the authority to adjust the gross rent to a reasonable amount. Additionally, the definition of "homestead" is refined to exclude unoccupied real property that is leased or rented by the owner unless it is adjacent and contiguous to the owner's home.

The bill also modifies the treatment of agricultural or horticultural lands in relation to homestead status based on the duration of the claimant's residence on the land. If the claimant has lived on the land for ten years or more, all adjacent agricultural or horticultural lands are considered part of the homestead. If the claimant has lived there for less than ten years, only up to five acres of such land qualifies. Furthermore, the bill clarifies that a mobile home or trailer coach in a park is classified as a homestead, and the site rent is treated as rent for a homestead. The definition of "total household resources" is also updated to exclude certain compensation related to wrongful imprisonment and specifies deductions from federal gross income.

Statutes affected:
Senate Introduced Bill: 206.508