City of Norwalk, CT Article VII Tax Deferral Program for Elderly and Disabled Homeowners

[Adopted 4-9-2002]

§ 103-16 Enactment; purpose.

The City of Norwalk hereby enacts, for the assessment year commencing October 1, 2001, and each assessment year thereafter, a tax deferral program for elderly and disabled homeowners pursuant to Section 12-129n of the Connecticut General Statutes for eligible residents of the City of Norwalk, on the terms and conditions provided herein. This article is enacted for the purpose of assisting elderly and disabled homeowners with a portion of the costs of property taxation.

§ 103-17 Eligibility.

Any resident of the City of Norwalk who qualifies under the following requirements is eligible for property tax deferral with respect to real property owned and occupied by such person as his or her legal domicile and principal, permanent residence:

A. Such resident at the close of the preceding calendar year has attained age 65 or over, or his or her spouse, who is living with such resident, is 65 years of age or over; or such resident is 60 years of age or over at the close of the preceding calendar year and is the surviving spouse of a taxpayer who was qualified in the City of Norwalk under this program at the time of his or her death, with respect to real property on which any such resident or spouse is liable for taxes under the provisions of Section 12-48 of the Connecticut General Statutes; or

B. Such resident is under age 65 and eligible in accordance with applicable federal regulations to receive permanent total disability benefits under social security; or has not been engaged in employment covered by social security and accordingly has not qualified for benefits thereunder, but has qualified for permanent total disability benefits under any federal, state or local government retirement or disability plan, including the Railroad Retirement Act, and any government-related teachers' retirement plan, in which requirements with respect to qualifications for such permanent total disability benefits are comparable to the requirements under social security; and

C. Such resident shall have been a taxpayer of the City of Norwalk and have paid taxes for a period of at least the 12 months immediately preceding his or her application for tax deferral under this article;

D. No tax deferral shall be given under this article to any person who owes delinquent property taxes, sewer fees or assessments or other delinquent charges to the City of Norwalk;

E. The property for which the tax deferral is claimed is the tax lot which is the legal domicile and principal, permanent residence of such person, together with all improvements thereon, and is occupied for more than 200 days of each year by such person;

F. Such resident shall have individually, if unmarried, or jointly, if married, qualifying income in an amount not to exceed $40,000 for the calendar year 2002 and $45,000 for the calendar year 2003 and thereafter equal to local maximum qualifying income. "Qualifying income" is defined as adjusted gross income, as defined in the Internal Revenue Code of 1986, as may be amended from time to time, plus the nontaxable portion of any social security benefits, railroad retirement benefits, income from other tax exempt retirement and annuity sources and income from tax exempt bonds, less an amount equal to the medical and dental expense deduction allowed or allowable under Section 213(a) of the Internal Revenue Code of 1986, as may be amended from time to time (currently allowed deduction for medical and dental expenses only if in excess of 7.5% of adjusted gross income);

[Amended 1-28-2008; 4-12-2016]

G. [1]Such resident, if eligible, shall have applied for, and have received, state-reimbursed property tax relief under the homeowners' program as outlined in Connecticut General Statute Section 12-170aa, or the program formerly known as the freeze program, as outlined in Connecticut General Statute Section 12-129b, for the same grand list year as the claimed deferral;

[1] Editor's Note: Former Subsection G, which provided for the adjustment of the maximum amount of qualifying income, was repealed 1-28-2003. The ordinance also provided for the redesignation of former Subsections H through J as Subsections G through I, respectively.

H. The market value of the real property for which the tax deferral is claimed shall not exceed $915,000, as determined by the most current property records on file in the office of the Tax Assessor; and

[Amended 4-12-2016]

I. Such resident may not receive both a locally funded tax credit, pursuant to § 103-5 of the Code of the City of Norwalk; and tax deferral hereunder simultaneously for the same grand list year. Applicants may receive either the local tax credit program, or for the tax deferral program, in any grand list year. A resident may receive the local credit for some grand list years, and the tax deferral for other grand list years.

§ 103-18 Filing of application.

A. In order for an eligible resident to receive a tax deferral hereunder an application must be filed with the office of the Tax Assessor not earlier than February 1 or later than May 15 of each year for the next fiscal year. This application for such tax deferral shall be accompanied by a copy of the applicant's most recent federal income tax return for the previous calendar year and written documentation of all other income.

B. The Tax Assessor shall require all necessary documents to determine eligibility. The withholding of such information, if reasonably available, shall be sufficient reason for the denial of tax deferral.

C. The Tax Assessor shall establish such application forms and procedures as may be necessary to implement this tax deferral program. The Tax Assessor, or his or her agent, shall determine what evidence of qualifying income is pertinent for the determination of eligibility under this article, and shall be responsible for requesting and reviewing the same.

D. All applications, including federal income tax returns filed under this program, as well as any and all additional evidence of qualifying income required by the Tax Assessor, shall be kept in strict confidence and shall not be open to public inspection, in accordance with State Freedom of Information guidelines.

§ 103-19 Limits of tax deferral.

A. For any eligible resident, for any given grand list year, the total of all tax credits, abatements, exemptions, and deferrals provided under state statutes for elderly and permanently disabled taxpayers, shall not exceed 75% of the tax which would have been levied against such resident. For the purpose of this section, the term "exemption" shall not be construed to include the graduated increase in property tax assessments due to revaluation of property. If the total of all tax credits, abatements, exemptions and deferrals provided under state statutes for elderly and permanently disabled taxpayers does exceed 75% of the tax which would have been levied against any eligible resident, for any given grand list year, the Office of the Tax Assessor shall administer the programs so as to allow for maximization of state-funded property tax relief, in accordance with § 103-24, herein.

B. For each grand list year, deferral hereunder shall be limited to the lesser of either an amount up to $4,500, or an amount up to 50% of the tax principal due, less any tax credits, abatements, exemptions and other benefits provided under state statutes for elderly and permanently and totally disabled taxpayers. For each grand list year, the minimum amount allowed for deferral hereunder shall be equal to the amount of the tax credit allowed under § 103-12.

[Amended 4-12-2016]

C. The total deferral is not to exceed 75% of the market value of the subject real property, as determined by the Office of the Tax Assessor.

§ 103-20 Tax deferral benefits; lien on property.

A. An eligible applicant shall enter into a written agreement with the City providing for payment to the City of the tax deferral. A separate agreement shall be entered into for each grand list year.

B. The principal amount of such tax deferral benefit, and the rate of interest on the deferred amount, as described herein, shall be recorded in the Norwalk Land Records and shall constitute a continuing, priority lien against the subject property, payable upon the death of the applicant or the conveyance of the subject property.

C. The eligible resident shall be charged the current statutory fees for releases of lien continuing certificates at the time of payment to the City.

§ 103-21 Rate of interest on deferred taxes.

A. All deferred taxes shall be subject to an interest charge, determined annually by the Director of Finance on January 1. Such interest charge shall be equal to the annual percentage rate of the most recent City bond issue, rounded to the nearest 0.5%, plus an additional 1.5%, per year.

B. All such interest charges shall be included in the written agreement entered into by the eligible resident and the City, and shall be included on the lien continuing certificate recorded in the Norwalk Land Records to reflect the deferral of taxes.

C. Interest shall be calculated on a monthly basis, with any portion of a month being considered a full month. Interest shall be simple interest, not compounded, and shall accrue from the month and year of the deferral until the month and year of the final payment to the City.

§ 103-22 Maximum credits.

The total tax deferral granted under the provisions of this program, together with the total tax relief granted under the provisions of §§ 103-5 through 103-12 of the Norwalk Code, shall not exceed an amount equal to 0.5% of the total property tax levy assessed in Norwalk in the preceding fiscal year.

§ 103-23 Deferral to be prorated.

A. Only one tax deferral shall be allowed for each parcel of real property eligible for deferral under this program. The Tax Collector's Office shall mail a bill for such taxes, which shall be immediately due and payable in a single installment, with a grace period of 30 days from the date the bill is mailed.

B. If such property is a multifamily dwelling, such deferral shall be prorated to reflect the fractional portion of such property that is currently occupied by the eligible resident.

C. Such tax, as well as any previous deferred taxes, shall be immediately due and payable, collectible in the same manner as all other property taxes, and subject to the same liens and collection enforcement proceedings, provided that such tax shall be payable in a single installment within 30 days after the date the bill is mailed by the Tax Collector.

D. If payment is not made upon demand at the conclusion of the deferral period, due to the death of the applicant or the conveyance of the property, the property shall become subject to Tax Collector's demand for payment and collection enforcement action in accordance with state statute. All deferred taxes, accrued interest, lien recording fees and collection costs, if any, shall be collectible in the same manner as all other property taxes, and subject to the same statutory penalty interest, liens and collection enforcement proceedings, as all other property taxes.

§ 103-24 Effect on other tax benefits.

The tax deferral granted to any eligible resident under this program shall not disqualify such eligible resident, or his or her surviving spouse, with respect to any tax relief for which such person is eligible under state tax relief programs. Any tax deferral provided shall be in addition to such state tax relief.

§ 103-25 Conclusion of deferral period.

A. All deferred taxes, accrued interest, and lien recording fees shall become due and payable to the City upon the death of the applicant or the conveyance of the subject property, at which time the deferral period shall be deemed concluded. In the case of a conveyance of the subject property, payment in full shall be made to the City upon conveyance of said property.

B. The estate of the applicant, or his or her agent or other party in interest, heirs and/or assignees, shall be solely responsible for notifying the Tax Assessor and Tax Collector of the death of the applicant within 60 days of the death and notify the Tax Assessor and Tax Collector of any Certificate of Devise within 60 days of the issuance of such certificate by the Probate Court.

C. The grantor of the property conveyed, his or her agent or other party in interest, heirs or assignees, shall be solely responsible for notifying the Tax Assessor and Tax Collector directly of the conveyance of the property formerly subject to deferral, within 30 days.

D. If payment is not made upon demand at the conclusion of the deferral period due to the death of the applicant or the conveyance of the property, the property shall be subject to the Tax Collector's demand for payment and collection enforcement action in accordance with state statutes.

E. In the case of the death of an applicant, the deferral period shall not be deemed concluded if there remains a surviving spouse who qualifies for deferral under § 103-17A, herein.

§ 103-26 Funding.

The Director of Finance shall make every effort to include in his or her annual budget an amount from the Undesignated Fund Balance to offset the estimated amount of taxes to be deferred under this program.