Wayne County offers ways to save on taxes
By Steve Herring
Published in News on December 31, 2012 1:46 PM
Jan. 1 not only signals the start of the county's tax-listing period, it is also the time for people to apply for programs that could help save them money on their tax bills.
The application period begins Jan. 1 and ends June 1 for three programs: Senior Citizen/Disability Homestead Exclusion; Disabled Veteran Property Tax Exclusion; and Homestead Circuit Breaker Tax Deferment Program (also called present use).
Applications made during that period may be approved by the county tax office. Late applications must go before the Wayne County Board of Commissioners.
Over the past several months, commissioners have approved a number of late applications for the tax relief programs -- mostly for the present use program that provides tax relief for farmland or forest land.
There were so many late applications this year, commissioners noted during one meeting that attorneys need to do a better job of letting people know about the program when they handle property sales.
Many of the late filers said they were unaware of the program or the requirement that the application must be resubmitted whenever the property changed ownership.
"What happens is we try to value everything at the time of revaluation at market value, whether it is farmland, woodland, whatever it may be," said Wayne County Tax Administrator David Ward. "If you own the property, you are farming it, or it is being farmed, or if you have a forestry management program and you are actively engaged in growing timber you can apply.
"If you meet the qualifications for that then you would be taxed at what is called present use value which is a different (lower) schedule than the market value schedule that we use."
The formula is provided by the state and can "get real technical," Ward said.
However, the tax difference between the market and present use values "sits out there" as a deferred tax, Ward said. The deferred taxes are a lien on the property, said Alan Lumpkin, assistant tax administrator.
"It can sit out there for who knows how long," Ward said. "But if you ever change the use of that property, deed off the property itself, deed off a portion of it -- anything like that can trigger a rollback on that difference, those deferred taxes. They could become due and payable based on the situation."
If that happens, the last three years of deferred taxes preceding the current tax year become due, as does the current year, he said.
The tax collector notifies each owner by Sept. 1 of each year of the accumulated sum of deferred taxes and interest.
How the tax payment is handled at the time of a sale depends on what the buyer and seller work out, Ward said.
There are numerous tests that people must go through to qualify for the program, including ownership and acreage, Ward said.
"Just because you buy my farm and want to continue to do it (present use exemption), it doesn't mean you can do it," Lumpkin said. "If you are a company versus an individual you probably won't qualify. It is not a given just because I have it (exclusion) and you want it."
Ward said he remembers when the program first started that the application took up one side of a single sheet of paper. Today it is four pages, front and back, he said.
North Carolina residents who are 65 or older or totally and permanently disabled, and who own and occupy their own home, are eligible to apply for the Senior Citizen/Disability Homestead Exclusion.
To qualify, though, all money the person receives during the year must be $28,100 or less, Ward said. That total includes all money received such as Social Security, VA benefits and interest income, he said. For married applicants residing with their spouse, the income of both spouses must be included, even if only one is an owner of the property.
"Whatever the value of your house is and lot, you would receive a minimum (tax break) of $25,000 or one-half the value of your home, whichever is more," Ward said.
For example, if a house and property were valued at $50,000, the person would pay taxes on half of the value, $25,000. If the total value was $100,000, the property would be taxed at $50,000.
"There is a state form you must have signed by a physician or state agency authorized to sign those type forms basically stating that you are totally and permanently disabled," Ward said.
The Disabled Veteran Property Tax Exclusion program requires a one-time application.
"You have to be a North Carolina resident," Ward said. "It must be your permanent residence which you own and occupy. You have to be an honorably discharged, disabled veteran, who, as of Jan. 1, has a total and permanent service-connected disability or receive benefits for specially adapted housing under a certain U.S. Code. It gets kind of involved.
"If you apply, and qualify for it, it is $45,000 of the value of your home. There is no either or, it is just a flat $45,000 value deducted from the value of your home with you paying the difference on the balance. There are no age or income restrictions."
Applications for these programs are available by calling the Wayne County Tax Department at 919-731-1461 or by downloading them from the county website, www.waynegov.com and navigating to the tax department section.