Vermont Property Tax Bill Processing Update - July 2018
For Vermont homeowners, July is the joyous time of year when property tax bills start to arrive in mailboxes. Have you received yours yet? Have you looked closely at it?
There are two reasons why you may want to take a second look:
Late Processing for Forms Filed On Time
According to our contact at the Vermont Department of Taxes, several Homestead Declarations were processed too late to make Town deadlines for mailing property tax bills, even if the Declarations were filed by April 17.
This can affect your property tax bill in two ways:
Your assessed value may be listed in the nonresidential tax column and subject to a different tax rate than if it was listed as residential
Your State Payment (Property Tax Adjustment) - if you qualified - may not be applied towards your balance due, making your installment payments larger than might be expected
What is being done about this? The Department assures us that all forms filed on time have now been processed and revised property tax bills will start going out soon.
However, they do suggest contacting them to be sure the forms were actually processed. This is causing quite a backlog of phone calls and emails at the State.
If your property tax bill doesn’t look quite right, be sure to contact our office so we may follow up with the State on your behalf.
After-the-Fact Calculation Change
In late May, a Special Session of the Legislation resulted in a change to the calculation of Property Tax Adjustments.
What is a Property Tax Adjustment?
A Property Tax Adjustment is the amount the State will pay towards your property taxes on your behalf. The calculation is based on Household Income, House Site Value, and Education and Municipal Taxes.
The change is this: if your reported Household Income is $90,000 or more, you can only apply for a State Payment on a maximum $225,000 of house site value. (This was reduced from $250,000.) If your Household Income is $90,000 or less, you can apply for a State Payment on a maximum $400,000 of house site value. (Reduced from $500,000.)
This seems like a small change, but the effect we are seeing on State Payments is a reduction of more than one-half the expected payment, as calculated under the old method.
Unfortunately, nothing can be done about this issue except grin and bear it. If you have questions about our tax services or if you’d like us to double-check the calculation, we are happy to help.
Thanks for reading,