Pay Attention to the Pink Slip

Not all pink slips bear bad news. The pink “Homestead Verification Form” that will be enclosed with your property tax bill is very important and can save you thousands!

A bill in the legislature has required that these forms be mailed out with the property tax bills in 2010, 2011 and 2012 and they must be completed and returned by every homeowner who wishes to claim a homestead deduction on their property. Property owners have until January 1, 2013 to return the card. These cards and the legislation requiring them are aimed at cracking down and preventing homestead fraud.

This form has not been widely publicized and can easily be overlooked as bureaucratic paperwork so please pay extra attention when opening your property tax bills.

Q: I didn’t find the form in my property tax bill?
A: Though some counties may choose to, they are only required to include the form to taxpayers already claiming the homestead deduction.

Q: I didn’t know it was important and I threw it out, can I get a new copy?
A: Yes, you can download the form here.

Q: If I don’t fill it out by January 1, 2013, will I automatically lose my deduction?
A: If you don’t complete the form by the deadline, you will receive a final notification letter from the county and your deduction could be removed on your 2012 – pay – 2013 property tax bill. You must complete the homestead verification form at least once in either 2010, 2011 or 2012.

Q: The form I was sent has a different – much sooner – deadline, what does that deadline mean?
A: Counties are permitted to establish internal deadlines to help streamline the processing of the forms. Missing the county’s internal deadline will not result in losing your homestead deduction; however it is best to advise your clients to return the forms to the County Auditor right away.

Q: Why has a change in homestead exemption filing occurred?
A: Individuals and married couples are limited to one homestead standard deduction. As the receipt of this deduction becomes more beneficial, there is more incentive than ever for homestead fraud. Homestead fraud causes higher tax bills for all; therefore, House Enrolled Act (HEA) 1344-2009 requires taxpayers who receive the homestead standard deduction to verify that they are eligible to receive the benefit and to provide additional identifying information necessary to allow county government to better monitor homestead filings. Homestead fraud occurs when an individual or married couple receive the benefit of more than one homestead deduction or claim the deduction on property that is not their primary residence. Homestead fraud causes taxpayers who follow the law to pay more money.

Who?
Every individual or married couple currently claiming the homestead deduction will receive the form. (Some counties may choose to mail the form to every taxpayer, even those not claiming the homestead deduction.)

What?
The pink form included with tax bills.

When?
The homestead verification form will be mailed with 2010, 2011 and 2012 tax bills and must be completed at least once by January 1, 2013.

Where?
Individuals or married couples claiming the homestead deduction must complete the form and return it to the county per the instructions included on the form. The form is not required to be returned in person.

Facts
A homestead is defined as a dwelling used as an individual’s primary residence, one garage and up to one acre of immediately surrounding land.
A primary residence is an individual’s true, fixed, permanent home to which the individual has the intention of returning after an absence.
The homestead standard deduction reduces the taxable assessed value of the homestead portion of a property by the lesser of 60 percent or $45,000. (Personal property mobile homes are limited to 50 percent of the home’s value in deductions). Individuals and married couples are limited to one homestead deduction. Those receiving the standard deduction automatically receive the supplemental homestead deduction, the 1 percent circuit breaker cap and any state or local homestead credits on the homestead property. Additional information regarding the homestead and other property tax deductions is available online at www.in.gov/dlgf/2344.htm.

More questions: Check out the Homestead Verification Form Fact Sheet and FAQ (PDF)

Source: MIBOR and Homestead Fact Sheet
Submitted by: David Brenton