Property tax refund options for older homeowners are growing thanks to new state and local programs. But homeowners must know about the programs and fill out the correct paperwork to take advantage of them.
This year marked the rollout of Kansas’ property tax “freeze’’ for qualifying homeowners. Called the Seniors or Disabled Veterans Refund (SVR), it is designed to keep an eligible homeowner’s taxes from increasing year to year. Over 10,000 claims for this refund have been filed across the state in 2023, according to the Kansas Department of Revenue.
The popularity of the SVR tax refund program will spread in 2024 as it becomes more widely known, predicted State Sen. Tom Holland, D-Baldwin City, chief architect of the property tax freeze legislation.
Also in 2024, the city of Wichita will conduct a pilot property tax refund program to help low-income homeowners who receive assistance from one of the state’s Homestead tax rebate programs. The city’s contribution could reduce the property tax for some homeowners to zero.
Spurring state and city tax property tax refund programs is the desire to enable low-income or fixed-income homeowners to afford to stay in their homes as valuations rise. SVR is the third of the state’s Homestead programs, which apply to houses, manufactured homes and other dwellings occupied as a taxpayer’s residence.
Participation in the state’s two older Homestead programs — Homestead Refund and Selective Assistance For Effective Senior Relief (SAFESR) had declined in recent years. For tax year 2018, the combined total claims from those two Homestead programs was 70,422, with $23,185,082 in refunds across the state. For the tax year 2021, claims totaled 65,267 and refunds totaled $21,560,884.
The Department of Revenue has not completed an analysis of the drop, but Holland noted that the income limit for participation in the two older Homestead programs had not risen enough in recent years. The household income eligibility ceiling for the new third option, SVR, is about twice as high as the income ceiling for the older Homestead programs. The SVR program pushed total Homestead refund claims back above 68,000 for the 2022 tax year.
“My guess is we’re going to see much more explosive growth with the new third one (SVR) that came on line” as people learn about it, Holland said.
Learning about Homestead
No figures are available showing how many homeowners potentially qualify for one of the refunds. Homeowners often learn about the Homestead programs through a tax preparer.
United Way of the Plains’ Volunteer Income Tax Assistance (VITA) program files the simple income tax return for free for thousands of taxpayers. More than half of the filers were over age 65 in a recent filing year, said Sarah Crick Milligan, United Way’s VITA Program Manager.
VITA’s newer clients often have never heard of Homestead property tax refunds, Milligan said. Repeat customers, on the other hand, are “pretty knowledgeable about the program or at least they know to ask,” she said.
Theresa and Charles Harper and their adult son with disabilities live in a home in south Wichita, and they have qualified for a Homestead refund. They use AARP tax filing assistance. “I would think that would be the only way you would find out about it,” Theresa Harper said of filers learning about Homestead through the tax preparer.
The state requires county treasurers to provide information about Homestead refunds when they mail property tax information to homeowners in the fall. Also, county clerk offices are to provide assistance for those with questions about Homestead or seeking to apply. Kathy Brier, office manager for the Sedgwick County Clerk office, said three employees help with Homestead filings and questions. The office has had over 400 people come in seeking help this year, and it receives many phone calls, too, Brier said.
The Sedgwick County Clerk’s office at 100 N Broadway, Ste 620. The phone number to reach help with Homestead refunds is (316) 660-9222. The Butler County Clerk’s office can be reached at (316) 322-4239 and the Harvey County Clerk’s office at (316) 284-6840.
Homeowners can choose only one of the three Homestead property tax options. United Way’s Milligan said it becomes apparent when filling out the boxes on the form which one fits or which is more advantageous for the homeowner.
Sedgwick County had more Homestead refund filers than any county in Kansas in calendar year 2021, with over 11,340 people, or about 2 percent of the county population, filing for a refund. In Harvey County, 3 percent of its population filed for a refund that year, and in Butler County, 2 percent of its population did.
“It’s always good to take advantage of what you can,” Milligan said. “These are here for us to take advantage of for a reason.”
Homestead refund requirements
Kansas homeowners can file for one — but only one — of the state’s three Homestead property tax refund programs. Income caps and other guidelines for the 2023 tax year, which is the 2024 filing year, are:
- At least 55 years old all of 2023, or blind or totally and permanently disabled, or has a dependent child living in the home and under 18 the whole year;
- Total household income is $40,500 or less, with 50 percent of Social Security and SSI benefits included in the income calculation;
- The home is appraised at $350,000 or less;
- A sliding scale determines the percentage of the refund, based on income. The maximum refund is $700. The statewide average refund under this program has been between $220 and $250 in recent years.
- At least 65 years old for all of 2023;
- Total household income, including all Social Security and SSI benefits, is $23,700 or less;
- The home is appraised at $350,000 or less;
- The SAFESR property tax refund is up to 75 percent of taxes. The statewide average refund has been between $1,165 and $1,285 in recent years. Fewer seniors qualify for this refund than for the Homestead Refund.
Seniors or Disabled Veterans/SVR
- At least 65 years old for all of 2023 or a disabled veteran; the surviving spouse of a claimant receiving this benefit at the time of the claimant’s death will be eligible to continue receiving this benefit until the surviving spouse remarries.
- Total household income, including 50 percent of Social Security and SSI benefits, is $53,600 or less;
- The house cannot be appraised higher than $350,000 in the base year, but the claimant remains eligible if the valuation rises;
- This is the newest property tax refund option, enacted in 2022 to freeze property taxes at the base year. The base year is when the claimant becomes eligible for this refund. Those filing in the 2022 tax year used 2021 as the base year and subtracted the taxes paid in 2021 from taxes paid in 2022 to determine the refund. The claimant’s base year continues into future tax years. The homeowner with a 2021 base year would use that when filing 2023 taxes. If a claimant moves, his base year is reset.
The average SVR refund is not known yet as claims for this year are still being processed.
Wichita to launch pilot refund in 2024
The city of Wichita will contribute toward complete coverage of the property tax bill for some older, low-income Wichita homeowners in 2024.In the one-year pilot program, the city will piggyback on the state’s Homestead property tax relief programs that cover a portion of low-income homeowners’ property taxes. For example, a homeowner qualifying for a 75 percent property tax refund under Homestead’s SAFESR program could have the remaining 25 percent covered by the city. To qualify for the city program, a homeowner first must be eligible for one of the state’s Homestead programs. Homestead applications are completed during the income tax filing season from January to April 15, 2024.
City Finance Director Mark Manning said staff used publicly available state data for Homestead programs to extrapolate that potentially 8,000 city residents could be affected and the cost could be in the neighborhood of $650,000 for a city program complementing Homestead. The city agreed to allocate $660,000 in general fund dollars for the pilot program.
Those getting aid from that $660,000 pool will be on a first-come, first-serve basis, according to City Communications Manager Megan Lovely.
“We will accept applications until funding is exhausted,” Lovely wrote in an email. The city will set a limit on how much it awards to a qualifying homeowner. “It will be 25 percent of their overall tax bill,” Lovely said.
The city did not set a date for announcing the application process for its pilot program, but the city is expected to make public the process for obtaining a city refund before 2024.
The city will evaluate the impact of the pilot program during the budget discussion next year, Lovely said.