HOUSE BILL No. 4780 May 16, 2001, Introduced by Reps. Whitmer, Lockwood, Pestka, Rich Brown, Plakas, Reeves and Phillips and referred to the Committee on Tax Policy. A bill to amend 1967 PA 281, entitled "Income tax act of 1967," by amending section 522 (MCL 206.522), as amended by 2000 PA 41. THE PEOPLE OF THE STATE OF MICHIGAN ENACT: 1 Sec. 522. (1) The amount of a claim made pursuant to this 2 chapter shall be determined as follows: 3 (a) A claimant is entitled to a credit against the state 4 income tax liability equal to 60% of the amount by which the 5 property taxes on the homestead, or the credit for rental of the 6 homestead for the tax year, exceeds 3.5% of the claimant's house- 7 hold income for that tax year. 8 (b) A claimant who is a senior citizen or a paraplegic, 9 hemiplegic, or quadriplegic and for tax years that begin after 10 December 31, 1999, a claimant who is totally and permanently 11 disabled or deaf is entitled to a credit against the state income 03331'01 RJA 2 1 tax liability for the amount by which the property taxes on the 2 homestead, the credit for rental of the homestead, or a service 3 charge in lieu of ad valorem taxes as provided by section 15a of 4 the state housing development authority act of 1966, 1966 PA 346, 5 MCL 125.1415a, for the tax year exceeds the percentage of the 6 claimant's household income for that tax year computed as 7 follows: 8 9 Household income Percentage 10 Not over $3,000.00 .0% 11 Over $3,000.00 but not over $4,000.00 1.0% 12 Over $4,000.00 but not over $5,000.00 2.0% 13 Over $5,000.00 but not over $6,000.00 3.0% 14 Over $6,000.00 3.5% 15 (c) For a tax year that begins before January 1, 2000, a 16 claimant who is totally and permanently disabled is entitled to a 17 credit against the state income tax liability equal to 60% of the 18 amount by which the property taxes on the homestead, or the 19 credit for rental of the homestead or for a service charge in 20 lieu of ad valorem taxes as provided in section 15a of the state 21 housing development authority act of 1966, 1966 PA 346, MCL 22 125.1415a, for the tax year, exceeds the percentage of the 23 claimant's household income for that tax year based on the sched- 24 ule in subdivision (b). 25 (d) A claimant who is an eligible serviceperson, eligible 26 veteran, or eligible widow or widower is entitled to a credit 03331'01 3 1 against the state income tax liability for a percentage of the 2 property taxes on the homestead for the tax year not in excess of 3 100% determined as follows: 4 (i) Divide the taxable value allowance specified in section 5 506 by the taxable value of the homestead or, if the eligible 6 serviceperson, eligible veteran, or eligible widow or widower 7 leases or rents a homestead, divide 17% of the total annual rent 8 paid for tax years before the 1994 tax year, or 20% of the total 9 annual rent paid for tax years after the 1993 tax year on the 10 property by the property tax rate on the property. 11 (ii) Multiply the property taxes on the homestead by the 12 percentage computed in subparagraph (i). 13 (e) A claimant who is blind is entitled to a credit against 14 the state income tax liability for a percentage of the property 15 taxes on the homestead for the tax year determined as follows: 16 (i) If the taxable value of the homestead is $3,500.00 or 17 less, 100% of the property taxes. 18 (ii) If the taxable value of the homestead is more than 19 $3,500.00, the percentage that $3,500.00 bears to the taxable 20 value of the homestead. 21 (2) A person who is qualified to make a claim under more 22 than 1 classification shall elect the classification under which 23 the claim is made. 24 (3) Only 1 claimant per household for a tax year is entitled 25 to the credit, unless both the husband and wife filing a joint 26 return are blind, then each shall be considered a claimant. 03331'01 4 1 (4) As used in this section, "totally and permanently 2 disabled" means disability as defined in section 216 of title II 3 of the social security act, 42 U.S.C. 416. 4 (5) A senior citizen who has a total household income for 5 the tax year of $6,000.00 or less and who for 1973 received a 6 senior citizen homestead exemption under former section 7c of the 7 general property tax act,Act No. 206 of the Public Acts of818931893 PA 206, may compute the credit against the state 9 income tax liability for a percentage of the property taxes on 10 the homestead for the tax year determined as follows: 11 (a) If the taxable value of the homestead is $2,500.00 or 12 less, 100% of the property taxes. 13 (b) If the taxable value of the homestead is more than 14 $2,500.00, the percentage that $2,500.00 bears to the taxable 15 value of the homestead. 16 (6) For a return of less than 12 months, the claim shall be 17 reduced proportionately. 18 (7) The commissioner may prescribe tables that may be used 19 to determine the amount of the claim. 20 (8) The total credit allowed in this section for each year 21 after December 31, 1975 shall not exceed $1,200.00 per year. 22 (9) The total credit allowable under this act and part 361 23 of the natural resources and environmental protection act, 1994 24 PA 451, MCL 324.36101 to 324.36117, shall not exceed the total 25 property tax due and payable by the claimant in that year. The 26 amount by which the credit exceeds the property tax due and 27 payable shall be deducted from the credit claimed under part 361 03331'01 5 1 of the natural resources and environmental protection act, 1994 2 PA 451, MCL 324.36101 to 324.36117. 3 (10) FOR TAX YEARS THAT BEGIN AFTER DECEMBER 31, 2000 AND 4 FOR PURPOSES OF THIS SECTION AND SECTION 520 ONLY, HOUSEHOLD 5 INCOME DOES NOT INCLUDE ANY AMOUNT PAID IN A YEAR BY A TAXPAYER 6 AS SUPPORT AS THAT TERM IS DEFINED IN SECTION 2 OF THE SUPPORT 7 AND PARENTING TIME ENFORCEMENT ACT, 1982 PA 295, MCL 552.602. 03331'01 Final page. RJA