In updated COVID-19 FAQ, Indiana Department of Local Government Finance clarifies application of interest to late property tax payments; No change (yet) to 2020 assessment notice & appeal deadlines; Abatement compliance extended; Waiver of penalties on special assessments and fees

In updated COVID-19 FAQ, Indiana Department of Local Government Finance clarifies application of interest to late property tax payments; No change (yet) to 2020 assessment notice & appeal deadlines; Abatement compliance extended; Waiver of penalties on special assessments and fees

On April 24th, the Indiana Department of Local Government Finance updated its FAQ covering topics related to “COVID-19 & Executive Orders,” as those orders relate to property tax assessments, collections and payments.

Interest On Late Payments

Section 12 addresses the application of interest to Spring 2020 real and personal property tax payments that are paid after May 11th (the due date) but on or before July 10th (the end of the 60-day grace period for the waiver of penalties ordered by the Governor).  It reads:

I know that penalties have been waived for any property tax payments made during the 60-day period, but what about interest? Will payments made during this period be subject to interest? What about payments made after the 60-day period, will those payments be subject to interest in addition to the 5% or 10%?

The 5% and 10% provisions outlined under Ind. Code § 6-1.1-37-10 are specifically described as penalty amounts that are added to the unpaid portion of a property tax payment, and the provisions directly related to unpaid property tax payments do[] not contemplate interest. For both real property and personal property, there are only a few statutory provisions that relate to interest payments, such as circuit court judgements under Ind. Code § 6-1.1-23-9 and the remaining unpaid portion of a property tax bill that was the subject of an unsuccessful assessment appeal under Ind. Code § 6-1.1-37-9. Aside from these limited situations, interest would not be applied to an outstanding property tax liability.

For example, if a property owner has a property tax obligation totaling $1,000 for the Spring Installment (due May 11, 2020), the amount that would be due on July 11, 2020, will depend on whether or not the property owner has a previous delinquency. If the property owner does not have a previous delinquent amount from a previous payment cycle (i.e. 2019 Fall Installment), the amount owed on July 11, 2020, would be the original $1,000 plus a 5% penalty of $50. If the property owner does have a previous delinquency, the amount owed on July 11, 2020, would be the original $1,000 plus a 10% penalty of the entire outstanding balance.

2020 Real Property Assessment Notice & Appeal Deadlines

In addition, the DLGF in Section 6 reports that there is no change in the notice dates triggering a taxpayer’s right to appeal its Jan. 1, 2020 assessed value:

Are Form 11s [i.e. assessment notices] still supposed to be mailed out by April 30?

Under IC 6-1.1-15-1.1(b)(2), the last day for counties to mail the Notice of Assessment (Form 11) is April 30 for an appeal deadline of June 15 of the assessment year. If the Notice of Assessment is mailed by the county on or after May 1 of the assessment year, the appeal filing deadline is June 15 of the year in which the tax bill is mailed by the county treasurer. In other words, if the Notice of Assessment is mailed on or May 1, 2020, the appeal filing deadline would be June 15, 2021.

Thus, the date that the Form 11 notice is issued — either before or on/after May 1st — still controls a taxpayer’s right to appeal the 2020 assessment on or before June 15th of 2020 or 2021.

In Section 7, the DLGF adds, “The Department has not been involved in any discussions regarding a delay for the [June 15th] appeal deadline.”

Abatement Compliance Delayed

Section 8 addresses the filing of abatement compliance documents:

While designating bodies may require property owners to complete and submit the Compliance with the Statement of Benefits form prior to the statutory deadline, they are not required to do so. Additionally, Executive Order 20-23 suspends the deadline for submitting compliance statements as required by IC 6-1.1-12.1-5.1 and IC 6-1.1-12.1-5.3 from May 15, 2020, until June 15, 2020. This extension would apply to any of the following compliance statements:

• Form CF-1/PP – Compliance with Statement of Benefits Personal Property

• Form CF-1/VBD – Compliance with Statement of Benefits Vacant Building Deduction

• Form CF-1/Real Property – Compliance with Statement of Benefits for Real Property Improvements

Waiver of Penalties on Special Assessments and Fees

Section 14 explains the waiver of penalties on special assessments and fees for sixty days:

Should we assume that all amounts, no matter if the current tax, delinquent tax/penalty, or special assessments/fees, are all to be excluded from penalties for the 60-day waiver period?

Per Executive Order 20-05, all penalties are to be waived for property tax payments. Executive Order 20-21, issued on April 15, 2020, states that penalties for failure to pay special assessments or fees which are included on the property tax bill and collected as part of the property tax payment shall also be waived for the 60-day waiver period. This includes conservancy district assessments for exceptional benefits, ditch and drain assessments, solid waste management fees, and storm water assessment fees. It also applies to any other fee or special assessment imposed by a local government and paid along with the May 11, 2020 installment of property taxes

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