Bill Summary – FastDemocracy

LB22                                                                                                    LB22
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                                   LEGISLATURE OF NEBRASKA
                            ONE HUNDRED EIGHTH LEGISLATURE
                                   FIRST SPECIAL SESSION
                           LEGISLATIVE BILL 22
       Introduced by Cavanaugh, J., 9.
       Read first time July 26, 2024
       Committee: Revenue
   A BILL FOR AN ACT relating to revenue and taxation; to amend sections
       77-3509.01,      77-3509.03,      77-3510,        77-3514,        and     77-3516,      Reissue
       Revised Statutes of Nebraska; sections 77-3512 and 77-3513, Revised
       Statutes Supplement, 2023; sections 77-3501, 77-3506.03, 77-3511,
       77-3521,   and    77-3529,       Reissue Revised Statutes of   Nebraska,      as
       amended by    Laws    2024,    LB126,        sections     2,    4,     5,   7,      and   10,
       respectively;      sections       77-3517        and   77-3523,          Revised Statutes
       Cumulative Supplement,      2022,     as amended by        Laws   2024,     LB126,
       sections 6 and 9; and sections 77-3522 and 77-4212, Revised Statutes
       Supplement, 2023, as amended by Laws 2024, LB126, sections 8 and 11;
       to state findings and declarations; to create a homestead exemption;
       to harmonize provisions; to provide an operative date; and to repeal
       the original sections.
   Be it enacted by the people of the State of Nebraska,
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       Section 1. Section 77-3501, Reissue Revised Statutes of Nebraska, as
   amended by Laws 2024, LB126, section 2, is amended to read:
       77-3501 For purposes of sections 77-3501 to 77-3529, and section 3
   of this act, and section 3 of this act, unless the context otherwise
   requires, the definitions found in sections 77-3501.01 to 77-3505.05 and
   section 3 of this act shall be used.
       Sec. 2. Section 77-3506.03, Reissue Revised Statutes of Nebraska, as
   amended by Laws 2024, LB126, section 4, is amended to read:
       77-3506.03 (1) Except as provided in subsection (2) of this section,
   for homesteads valued at or above the maximum value, the exempt amount
   for any exemption under section 77-3507 or 77-3508 shall be reduced by
   ten percent for each two thousand five hundred dollars of value by which
   the homestead exceeds the maximum value and any homestead which exceeds
   the maximum value by twenty thousand dollars or more is not eligible for
   any exemption under section 77-3507 or 77-3508.
       (2)(a) For homesteads valued at or above the maximum value, the
   exempt amount shall not be   reduced and the homestead shall remain
   eligible for an    exemption under section   77-3507     or   77-3508    for the
   current year if the homestead:
       (i) Received an exemption under section 77-3507 or 77-3508 in the
   previous year;
       (ii) Was valued below the maximum value in such previous year; and
       (iii) Is not ineligible for an exemption under section 77-3507 or
   77-3508 for any reason other than as provided in subsection (1) of this
   section.
       (b)     If     a homestead remains eligible for an   exemption under
   subdivision (a) of this subsection for any year, the homestead shall
   continue to be eligible for each year thereafter unless the homestead is
   not eligible for such exemption for any reason other than as provided in
   subsection (1) of this section.
       (c) The percentage of the exempt amount for a homestead for any year
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   such homestead is valued at or above the maximum value and remains
   eligible for exemption under this subsection shall be     equal to   the
   percentage of the exempt amount for the homestead in the last year the
   homestead received an exemption under section 77-3507 or 77-3508 and was
   valued below the maximum value.
       (d) If the homestead's increase in value from the previous year to a
   value at   or above the maximum value is   due to    improvements to   the
   homestead, this subsection shall not apply to such homestead.
       (3) This section shall not apply to any exemption under section
   77-3506 or section 3 of this act.
       Sec. 3.        (1) The Legislature finds and declares that:
       (a) Pursuant to Article VIII, section 2, of the Constitution of
   Nebraska, the Legislature may exempt from taxation a portion of the value
   of any residence actually occupied as a homestead by any classification
   of owners;
       (b) The existing homestead exemption system should be protected and
   expanded; and
       (c) Exempting a larger portion of homesteads from taxation will
   provide broad-based property tax relief to Nebraska residents.
       (2) All homesteads in this state shall be assessed for taxation the
   same as other property, except that commencing January, 1, 2025, there
   shall be   exempt from taxation of   homesteads the first one hundred
   thousand dollars of the actual value of the homestead.
       (3) The exemptions in sections 77-3506, 77-3507, and 77-3508 shall
   be in addition to the exemption described in subsection (2) of this
   section.
       Sec. 4. Section 77-3509.01, Reissue Revised Statutes of Nebraska, is
   amended to read:
       77-3509.01 If an owner of a homestead applies for an exemption under
   section 77-3506, 77-3507, or 77-3508 or section 3 of this act for any
   year and such owner subsequently becomes the owner of another homestead
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   prior to August 15 of such year, the owner may file an application with
   the county assessor of the county where the new homestead is located for
   a transfer of the exemption to the new homestead. The owner shall file
   the application for transfer with the county assessor on or before August
   15    of such year or     within thirty days after receiving      a notice of
   rejection on    the owner's application for exemption for the original
   homestead.         The county assessor shall examine each application for
   transfer and determine whether or not the new homestead, except for the
   January 1 through August 15 ownership and occupancy requirement and the
   income requirements, is eligible for exemption under section 77-3506,
   77-3507, or 77-3508 or section 3 of this act. If the application for
   transfer is approved by the county assessor, he or she shall make a
   deduction upon the assessment rolls using the same criteria as previously
   applied to the original homestead. The county assessor may allow the
   application for transfer to also be considered an application for a
   homestead exemption for the subsequent year.
          Sec. 5. Section 77-3509.03, Reissue Revised Statutes of Nebraska, is
   amended to read:
          77-3509.03 All property tax statements for homesteads granted an
   exemption in sections 77-3506, 77-3507, and 77-3508 and section 3 of this
   act shall show the amount of the exemption, the tax that would otherwise
   be due, and a statement that the tax loss shall be reimbursed by the
   state as a homestead exemption.
          Sec. 6. Section 77-3510, Reissue Revised Statutes of Nebraska, is
   amended to read:
          77-3510 On or before February 1 of each year, the Tax Commissioner
   shall prescribe forms to be used by all claimants for homestead exemption
   or for transfer of     homestead exemption.      Such forms shall contain
   provisions for the showing of all information which the Tax Commissioner
   may deem necessary to   (1)   enable the county officials and the Tax
   Commissioner to determine whether each claim for exemption under sections
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  77-3506, 77-3507, and 77-3508 and section 3 of this act should be allowed
  and (2) enable the county assessor to determine whether each claim for
  transfer of homestead exemption pursuant to section 77-3509.01 should be
  allowed. It shall be the duty of the county assessor of each county in
   this state to furnish such forms, upon request, to each person desiring
  to make application for homestead exemption or for transfer of homestead
  exemption. The forms so prescribed shall be used uniformly throughout the
   state, and no application for exemption or for transfer of homestead
   exemption shall be allowed unless the applicant uses the prescribed form
   in making an application. The forms shall require the attachment of an
  income statement for any applicant seeking an exemption under section
  77-3507 or 77-3508 as prescribed by the Tax Commissioner fully accounting
  for all household income. The Tax Commissioner shall provide to each
   county assessor claim forms and address lists of applicants from the
   prior year in    the manner approved by    the Tax Commissioner.       The
   application and information contained on   any attachments to   the
   application shall be confidential and available to tax officials only.
        Sec. 7. Section 77-3511, Reissue Revised Statutes of Nebraska, as
  amended by Laws 2024, LB126, section 5, is amended to read:
         77-3511 The application for homestead exemption or for transfer of
  homestead exemption shall be signed by the owner of the property who
  qualifies for exemption under sections 77-3501 to 77-3529, and section 3
   of this act, and section 3 of this act unless the owner is an incompetent
   or unable to make such application, in which case it shall be signed by
  the guardian. If an owner who in all respects qualifies for a homestead
  exemption under such sections dies after January 1 and before the last
   day for filing an    application for   a homestead exemption and before
   applying for a homestead exemption, his or her personal representative
  may file the application for exemption on or before the last day for
   filing an application for a homestead exemption of that year if the
   surviving spouse of such owner continues to occupy the homestead. Any
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  exemption granted as a result of such application signed by a personal
  representative shall be in effect for only the year in which the owner
  died.
      Sec.   8.   Section   77-3512,       Revised Statutes Supplement,     2023,   is
  amended to read:
       77-3512 (1) It shall be the duty of each owner who wants a homestead
   exemption under section 77-3506, 77-3507, or 77-3508 or section 3 of this
  act to file an application therefor with the county assessor of the
   county in which the homestead is located after February 1 and on or
   before June 30 of each year, except that:
      (a) The county board of the county in which the homestead is located
  may, by majority vote, extend the deadline for an applicant to on or
   before July 20. An extension shall not be granted to an applicant who
   received an extension in the immediately preceding year;
       (b)    An owner may file   a late application pursuant to    section
  77-3514.01 if he or she includes documentation of a medical condition
  which impaired the owner's ability to file the application in a timely
  manner;
      (c)    An owner may file   a late application pursuant to    section
   77-3514.01 if he or she includes a copy of the death certificate of a
   spouse who died during the year for which the exemption is requested;
      (d) A veteran qualifying for a homestead exemption under subdivision
  (2)(a) of section 77-3506 shall only be required to file an application
  in every subsequent year evenly divisible by five; and
       (e) If a veteran who has been granted a homestead exemption under
   subdivision (2)(a) of section 77-3506 dies during the five-year exemption
   period, the surviving spouse of such veteran shall continue to receive
   such exemption for the remainder of the five-year exemption period. After
   the expiration of the five-year exemption period, the surviving spouse
  shall be required to file for an exemption under subdivision (2)(b) of
  section 77-3506 on an annual basis.
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       (2) Failure to file an application as required in subsection (1) of
   this section shall constitute a waiver of the exemption for the year in
   which the failure occurred.
       Sec.    9.     Section    77-3513,    Revised Statutes Supplement,      2023,   is
   amended to read:
      77-3513 The county assessor shall mail a notice on or before April 1
   to claimants who are the owners of a homestead which was granted an
   exemption under section 77-3506, 77-3507, or 77-3508 or section 3 of this
   act and who are required to refile for such exemption in the current year
   unless the claimant has already filed the application for the current
   year or the county assessor has reason to believe there has been a change
   of circumstances so that the claimant no longer qualifies. The notice
   shall include the claimant's name, the application deadlines for the
   current year,    a list of    documents that must be    filed with the
   application,     and the county assessor's office address and telephone
   number.
       Sec. 10. Section 77-3514, Reissue Revised Statutes of Nebraska, is
   amended to read:
       77-3514 A claimant who is the owner of a homestead which has been
   granted an   exemption under section     77-3506,   77-3507,    or     77-3508    or
   section 3 of this act may notify the county assessor by August 15 of each
   year of any change in the homestead exemption status occurring in the
   preceding portion of the calendar year as a result of a transfer of the
   homestead exemption pursuant to sections 77-3509.01 and 77-3509.02. If by
  his or her failure to give such notice any property owner permits the
   allowance of the homestead exemption for any year after the homestead
   exemption status of such property has changed, an amount equal to the
   amount of the taxes lawfully due but not paid by reason of such unlawful
   and improper allowance of homestead exemption, together with penalty and
   interest on such total sum as provided by statute on delinquent ad
  valorem taxes, shall be due and shall upon entry of the amount thereof on
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   the books of the county treasurer be a lien on such property while
   unpaid. Such lien may be enforced in the manner provided for liens for
   other delinquent taxes. Any person who has permitted the improper and
   unlawful allowance of such homestead exemption on his or her property
   shall, as an additional penalty, also forfeit his or her right to a
   homestead exemption on any property in this state for the two succeeding
   years.
         Sec. 11. Section 77-3516, Reissue Revised Statutes of Nebraska, is
   amended to read:
         77-3516   The county assessor shall examine each application for
   homestead exemption filed with him or her for an exemption pursuant to
   section 77-3506, 77-3507, or 77-3508 or section 3 of this act and shall
   determine,     except for the income requirements,         whether or    not such
   application should be     approved or    rejected.       If the application is
   approved, the county assessor shall mark the same approved and sign the
   application. In case he or she finds that the exemption should not be
   allowed by reason of not being in conformity to law, the county assessor
   shall mark the application rejected, state thereon the reason for such
   rejection, and sign the application. In any case when the county assessor
   rejects an    application for exemption,      he or   she shall notify the
   applicant of such action by mailing written notice to the applicant at
   the address shown in     the application within ten days after the