Skip Maine state header navigation
|
|
DEPARTMENT
OF ADMINISTRATIVE AND FINANCIAL SERVICES Rule No. 901 (18-125 CMR
901) |
|
MAINE RESIDENTS PROPERTY
TAX PROGRAM |
|
|
SUMMARY: The purpose of this rule is to provide
comprehensive definitions and explanations of statutory terms and procedures
for claiming benefits under the Maine Residents Property Tax Program. Outline of Contents: ___________________________________________________________________________________ .01 Claimant A.
Generally. A claimant must have been domiciled in Maine and owned or
otherwise maintained a homestead in Maine during the entire calendar year for
which relief is requested under the Maine Residents Property Tax Program. In addition, a claimant must have occupied
the homestead for at least six (6) months during that year, and, except for a
homestead held in a revocable trust or under a legally binding agreement that
allows the owner to transfer title to the property but continue to occupy the
dwelling as a home, must have been personally responsible for the payment to
the municipality or other taxing authority of property tax on the homestead
or for the payment to the lessor of rent on the homestead. The legal guardian or attorney in fact of a
claimant may file a claim on behalf of the claimant. B.
Death of Claimant. The right to file a
claim does not survive the claimant’s death. If a valid claim was filed prior
to death, reimbursements made after the death of the claimant will be made to
the claimant’s spouse, or if no spouse, will be divided equally among
surviving members of the household. If
the claimant was the only member of the household, reimbursement may be made
to the claimant’s personal representative. If a personal representative is not
appointed within two (2) years of the filing of the claim, the amount of the
claim escheats to the State. C. Unmarried
individuals. If a homestead is occupied by two or more unmarried
individuals, none of whom is a dependent of another, and all of whom meet the
qualifications of a claimant, each must file a separate application as if
living alone. Each must list his or
her income and claim his or her share of the total tax assessed or rent paid.
D. Marital
status. If a married couple was living
together in the same homestead on the last day of the claim year, only one
application can be filed. The claimant
may be either the husband or the wife, but there may be only one claimant per
household. If the spouses are living
apart and thereby do not occupy the same homestead on the last day of the
claim year and filed Maine income tax returns as married filing separate,
separate applications may be filed containing the claimant’s and dependents’
household income (excluding the spouse's income) and claiming the property
tax or rent on the separate homestead. However, if the spouses file a joint Maine income
tax return, only one application can be filed. On this application, they must include their
combined household income and can claim the tax or rent on only one of the
homesteads as if they were living together. E. One
spouse a resident, the other a nonresident. If the
homestead is jointly owned by the spouses, the spouse who is the Maine
resident is the claimant. The claimant
must include the income of both spouses on the application and claim the
total property tax assessed or rent paid on the Maine homestead. F. Spouse
confined to a nursing home. If a husband and wife own a homestead jointly and one
spouse is a patient in a nursing home, the application must include the
income of both spouses and claim the total property tax assessed or rent paid
on the homestead only. G. Dependent.
A
dependent is a person who is claimed (or could be claimed) as a dependent on
another person’s income tax return. A
dependent does not qualify as a claimant. H. Ownership
of homestead as heirs or devisees. To qualify as a claimant, an heir or devisee must
document his or her ownership of the homestead for the entire year for which
a claim is filed, occupy the homestead for at least six months of the year
for which a claim is filed, and otherwise qualify to be the claimant. A copy of a will listing all the devisees to
the property is one example of acceptable documentation of ownership. If more than one heir or devisee has an
ownership interest in the property (even if merely beneficial), a written
statement is required from all other heirs or devisees stating that they did
not occupy the homestead or, if occupancy was shared, must include
information related to the actual percentage of occupancy claimed for
purposes of their own application for refund. .02 Homestead A. Generally.
“Homestead”
means the dwelling owned or rented by the claimant or held in a revocable
living trust for the benefit of the claimant and occupied by the claimant and
the claimant’s dependents as a home. The
homestead may consist of a part of a multidwelling
or multipurpose building and up to 10 acres of contiguous land. Separate parcels of land are considered
contiguous if separated solely by a road, or public or private right of
way. “Dwelling” means an individual
house, apartment, duplex unit, co-op unit, condominium unit, mobile home, or
mobile home pad. “Owned” includes possession
by a purchaser under a land contract and one or more joint tenants or tenants-in-common
and possession under a legally binding agreement that allows the owner of the
dwelling to transfer title to the property but continue to occupy the
dwelling as a home until some future event stated in the agreement. B. Ownership
of homestead. Ownership of a homestead may be by fee, by life tenancy,
by bond for a deed, as mortgagee, or any other similar possessory interest
provided that the owner is personally responsible to the municipality or
taxing authority for the property tax for which a refund is claimed. C. Room
and Board. A homestead does not include room and board when amounts
paid for food, personal care, laundry, or similar items or services are not
distinguishable from amounts paid for the right to occupy a homestead. A homestead also does not include a nursing
home or a room in another person’s private home. D. Seasonal
Dwelling Occupied as a Home. Generally, a claimant who has more than one home or
apartment at the same time during the year must base a claim on the claimant’s
primary homestead. For example, an
applicant owns a seasonal house which he or she occupies as a home for part
of the year. During the remainder of
the year, the claimant rents and occupies an apartment. Both the house and the apartment are in
Maine. The claim must be based on a
prorated share of the tax on the seasonal home and the rent paid for the
apartment during occupancy. The
prorated tax amount is based on the time the claimant occupies the seasonal
home divided by the period of ownership. E. Congregate
Housing. Congregate housing generally allows individuals to live
independently. However, the rent
amount usually includes heat, utilities, housekeeping services,
transportation, and use of common areas. In addition, meals are available in a
central dining room for an additional charge. An individual living in congregate housing
may qualify as a claimant (if otherwise eligible) based on the amount of rent
paid for the right to occupy the apartment. The remainder of the monthly rent amount
that covers heat, utilities, services, meals, or similar items must be
excluded from the rent claimed on the application. F. Occupying
the homestead. A claimant must have occupied his or her homestead for at
least six months during the claim year in order to be eligible for a refund. A claimant is considered to have occupied
the homestead during a temporary absence due to exigent circumstances such as
illness, hospitalization, and military deployment, provided that the claimant
does not rent the homestead to another person during the period of temporary
absence. G. Maintaining
the homestead. A claimant must have owned or rented (as a lessee) one or
more homesteads in Maine for all 12 months during the year for which relief
is requested. A homestead is not
maintained during any period in which the owner or lessee leases or
sub-leases the dwelling to another person. .03 Household
& household income A. Household.
A “household” is comprised of a
claimant, spouse and any individual who the claimant is entitled to claim as
a dependent under Maine income tax laws for the year for which relief is
requested, whether or not the individual is actually claimed as a dependent
on a tax return. A spouse is not
considered a member of the household only if: (1) the spouse is living in a
homestead other than the homestead of the claimant; and (2) separate
applications are being filed in accordance with section .01(D) above. B. Household
income; amounts included. Annual
household income includes the following income received by all members of the
household, including the claimant and the claimant’s spouse and any
dependents: 1. The sum
of Maine adjusted gross income, defined as federal adjusted gross income
modified by 36 MRSA § 5122, reported or required to be reported on all Maine
income tax returns filed by each member of the household; plus 2. Income
(other than amounts excluded below) that is received by each member of the
household that is not included in Maine adjusted gross income , including,
but not limited to: (a) Salaries
and wages; (b) Dividends
and interest; (c) Loss
add-back amounts; (d) Social
Security benefits, railroad retirement benefits, pensions, and distributions
from ROTH IRAs; (e) Contributions
to pension, annuity or retirement plans made on behalf of that member of the
household; (f) Cash
public assistance; (g) State
supplemental income; (h) Alimony
payments; (i) Capital
gains; (j) Child
support payments; (k) Gambling
and lottery winnings; (l) Cash
inheritances (except as provided by subsection C below); (m) Jury
duty payments; (n) Life insurance proceeds (except as provided
by subsection C below); (o) Nontaxable
lawsuit awards (except as provided by subsection C below); (p) Nontaxable
strike benefits; (q) Nontaxable employee contributions to a
Flexible Spending Arrangement; (r) Employer-paid benefits for a Dependent Care
Assistance Program under Section 129 of the Internal Revenue Code; (s) Prizes
and awards; (t) Rental
income; (u) Unemployment
compensation; (v) Worker's
compensation and loss of time insurance; and (w) Any
other income received by each household member who did not file a Maine
income tax return to the extent the income should have been included in Maine
adjusted gross income if the household member had filed a Maine income tax
return. C. Household
income; amounts excluded. Annual
household income does not include: 1. Rollovers
of IRA, pension or annuities into another IRA, pension or annuity, even if
they were included in Maine adjusted gross income; 2. Refunds
received from the Maine Residents Property Tax and Rent Refund Program; 3. The first
$5,000 in proceeds of a life insurance policy, whether paid in a lump sum or
in the form of an annuity. An
applicant who receives a lump-sum benefit should subtract $5,000 from the
amount received and report the remainder as income. For example, an applicant who receives
$25,000 in life insurance benefits would include $20,000 in income on the
application ($25,000 minus $5,000). If
the benefits are being paid in an annuity, the benefits received must be
included in income once the first $5,000 is exceeded. For example, an applicant who receives
$3,000 a year for 20 years would exclude the $3,000 received in the first
year and $2,000 received in the second year. The remaining $1,000 received in the second
year and all benefits received in the succeeding years must be included in
income; 4. Gifts
from nongovernmental sources or surplus foods or other relief in-kind that is
supplied by a governmental agency; 5. Inheritance
from a deceased spouse; or 6. Reimbursement
of medical and legal expenses resulting from a lawsuit award. .04 Property taxes
accrued A. Property taxes accrued. “Property
taxes accrued” means property taxes exclusive of special assessment,
delinquent interest, and charges for service levied on a claimant’s homestead
in this State as of April 1 of the claim year. “Property taxes accrued” means only the
portion of property taxes levied that was not abated for infirmity or poverty
during the year for which the claimant requests relief. If a claimant owns and occupies two (2) or
more different homesteads in Maine in the same calendar year, property taxes
accrued means the total of the property taxes owed for the time that each
property was occupied by the claimant and claimant’s household as a
homestead. To calculate the amount
attributable to each property, the April 1 assessment on each homestead is
multiplied by the percentage of 12 months that each property was owned and
occupied by the claimant as the claimant's homestead during the year for
which relief is requested. When a
municipality changes the dates of its fiscal year (for example, from January
1-December 31 to July 1-June 30) and assesses an eighteen-month tax amount,
the property taxes accrued will be the eighteen-month amount based on the
April 1 assessment for that claim year, even if the municipality issues two
separate tax bills spaced several months apart. B. Exemptions. If the
claimant has an exemption for part of the valuation of the property, such as
a veteran’s exemption or a homestead exemption for part of the valuation of
the property and the homestead is part of a larger unit, the amount of the
exemption must be subtracted from the valuation of the house and house lot. C. Multiple owners. Generally,
a claimant who occupies a homestead that is owned by several persons, one of
whom is the claimant, must base the claim on his or her pro rata share of the
property tax assessed on the homestead. For example, if a homestead is owned by
three persons and one of those persons occupies it, that person is the
claimant and can claim one-third of the total tax. The others cannot file a claim based on that
homestead because they live elsewhere. If, however, the claimant is solely
responsible for the payment of the tax under the terms of a written agreement
with all the other owners that states the claimant is allowed to occupy the
homestead, he or she can base the claim on the total tax. D. Part of a larger unit. If a homestead is an integral part of a larger
parcel of property, such as a farm or multipurpose or multi-dwelling
building, the property taxes accrued for the homestead equal a percentage of
the total property taxes that represent the percentage of the homestead’s
value to the total value of the larger unit. .05 Rent constituting
property taxes accrued The term “rent,” for purposes of 36 MRSA § 6201(11) and
(11-A), means the gross rent actually paid in cash or its equivalent for
right of occupancy in any year for which relief is requested by the claimant
or a member of the claimant’s household. Rent does not include amounts paid by
municipal general assistance vouchers. Rent also does not include amounts paid for
utilities, services, furniture, furnishings, or personal property appliances
or for anything other than the right to occupy a homestead. First-time claimants must provide proof of
payment for rents exceeding $9,000 annually. AUTHORITY: 36 MRSA
§112 ORIGINAL EFFECTIVE DATE: January 1, 1997 AMENDED: June 6,
2006 (Effective date July 11, 2006 ) February 11, 2008 August 19, 2012 – filing 2012-229 |
