HB 1335 — North Dakota (2025) — Homestead Tax Credit (Amend NDCC §57‑02‑08.1(1))
Status
- Introduced: Nov 14, 2024
- Sponsors: Reps. Christianson, D. Johnston, Morton, Motschenbacher, Vetter; Sens. Cory, Meyer
- Procedural status: Second reading — failed to pass (yeas 35, nays 58).
- Bill text would amend and reenact subsection 1 of NDCC §57‑02‑08.1 and includes an effective‑date clause (if enacted).
Purpose / Intent
- To expand eligibility for North Dakota’s homestead tax credit by (1) lowering the minimum age for eligibility and (2) raising the income thresholds that determine the size of the assessment reduction. The bill makes no change to the maximum dollar reductions available.
Key provisions (summary of substantive changes)
- Eligibility age: Lowers the age threshold from 65 to 62 for persons to qualify for the homestead assessment reduction. Eligibility continues to include persons who are permanently and totally disabled.
- Income thresholds and benefit schedule: Revises the two income tiers used to compute the reduction:
- Current (stricken) / Proposed (underlined in bill):
- Tier 1: income not in excess of $40,000 → changed to not in excess of $70,000. Qualifies for a 100% reduction of the homestead taxable valuation up to a maximum reduction of $9,000 of taxable valuation.
- Tier 2: income in excess of $40,000 and not in excess of $70,000 → changed to income in excess of $70,000 and not in excess of $100,000. Qualifies for a 50% reduction of the homestead taxable valuation up to a maximum reduction of $4,500 of taxable valuation.
- Nursing‑home absence: Continues the current rule that the exemption remains if the eligible person is confined to a nursing home, hospital, or similar care facility so long as the previously occupied portion of the homestead is not rented to another person.
- Other clarifying/administrative provisions retained or restated:
- Co‑residing spouses or dependents are entitled to only one exemption among them; co‑owners who are not spouses or dependents receive a pro rata share based on ownership interest.
- The exemption does not reduce liability for special assessments.
- Applicants must sign a verified statement of facts establishing eligibility; income information in that statement is confidential.
- Assessors must attach the statement to the assessment sheet and show the reduction.
- The exemption terminates at the end of the taxable year of the applicant’s death.
- Effective date (as drafted): the act would be effective for taxable years beginning after December 31, 2024 (if enacted).
Who would be affected
- Primary beneficiaries: homeowners who are age 62 or older (down from 65) or permanently and totally disabled, whose household income falls at or below the revised thresholds ($70,000 and $100,000 tiers).
- Secondary effects: county assessors (administration and recordkeeping), local taxing jurisdictions (potential reduction in taxable valuation base), and co‑owners/spouses of homestead properties.
Potential fiscal/administrative impacts
- By lowering the age threshold and raising income ceilings, the bill would likely increase the number of qualifying homesteads and reduce taxable valuations for those properties — producing some reduction in property tax bases for local taxing units. The bill does not specify state reimbursement to local governments. Administrative impacts would include processing more claims, attaching/retaining verified statements, and applying the revised assessment reductions.
Procedural note
- Although the bill included an effective‑date provision for taxable years beginning after 12/31/2024, it failed to advance on second reading (yeas 35, nays 58) and therefore did not become law as drafted.
