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Property owners have one last chance to keep homestead exemption intact
Cindy Klepper - Thursday, October 4, 2012 8:04 AM
Property owners in Huntington County have one last chance to keep their homestead exemptions intact.
If they don't, they may see their property taxes double in 2013.
The push is a result of the tough economic times, says Huntington County Auditor Cindy Yeiter, whose office is responsible for making sure that those who claim a homestead exemption on a property are, in fact, using that property as their primary residence.
"Things are getting tight, and people want to take advantage of as much as they can," she says.
As a result, people who own both a primary residence and a secondary residence - perhaps a winter home in Florida or some other sunny spot - may have claimed a homestead exemption on both homes, she says.
That's not allowed.
"You can have one exemption for one house in the U.S.A.," she says.
Her office has also run across landlords who claim a homestead exemption for their rental properties - something that is also not allowed.
And money is not only tight for the taxpayer. It's also tight for governmental units, which are trying to do more, or sometimes just stay on an even keel, with less revenue coming in.
So state and local governments, for the past three years, have been weeding out the deductions claimed by people who weren't actually entitled to them.
The "homestead verification form" - a pink piece of paper - was mailed out to property owners along with the tax bills in 2010, 2011 and 2012.
It asks them to verify that they do, in fact, live in the property for which they are claiming the deduction.
Yeiter estimates that of the approximately 8,000 residential properties in Huntington County, about 6,150 people have returned the verification form.
That leaves about 1,850 taxpayers who have not yet returned the form and are in danger of losing the deduction.
"Sometimes, when mortgage companies are paying, they don't look at the (tax) bill," Yeiter says.
So this time, Yeiter's office is sending the forms out by themselves.
This is the last time that property owners will receive a homestead verification form. Property owners who are living in the home listed on the form must return the completed form to the auditor's office no later than Dec. 31.
Those who do not return the form will lose their homestead exemption, which will double their property tax bill, Yeiter says.
Yeiter says her office mailed out the 1,850 homestead verification forms on Oct. 1. The forms are printed on pink paper. They are being sent only to property owners that did not return the forms in previous years.
Homeowners must return the forms even if their taxes are paid by a mortgage company, Yeiter says.
Those who receive a form in the mail this month but believe they've sent it back in during one of the three previous mailings should fill it out and send it in again.
"You need to fill it out and send it in to us because it may have gotten lost," Yeiter says.
Those who want to check if their homestead exemption is on file can look at the second page of their most recent tax bill. If it is on file, the notation "Homestead verification (pink form) returned" will be listed under "Type of Deduction" on the lower right side of the second page.
Individuals and married couples are limited to one homestead standard deduction.
People who claim the homestead exemption without being entitled to it "create higher tax bills for everyone else," Yeiter says.
The verification is required to prevent fraud. The auditor may request proof that a home is the applicant's principal place of residence. If proof is not provided, the owner could be ordered to pay the amount by which property taxes were reduced over the previous three years because of the improper homestead deduction along with a 10 percent penalty.
The homestead deduction is one of several deductions available to Huntington County property owners.
Others include the mortgage deduction, a deduction for certified non-profit organizations that own property, geothermal/solar deductions; deductions for the blind or disabled; deductions for some residents older than 65, and the disabled veteran's deduction.
Huntington County Auditor Cindy Yeiter displays the homestead verification form that was mailed out this month to approximately 1,850 Huntington County homeowners. The forms must be returned by the end of the year or those property owners will see their tax bills double.