Proceed with Caution, Part VII (March 2013):  Jurisdiction in Indiana Property Tax Assessment and Exemption Appeals; Filing Petitions on Time (and Proving It)

Proceed with Caution, Part VII (March 2013): Jurisdiction in Indiana Property Tax Assessment and Exemption Appeals; Filing Petitions on Time (and Proving It)

Jurisdiction … It’s about Property Taxes (for the Year Under Appeal)

Indiana Board had jurisdiction to consider proper application of property “tax caps.”  Fred W. Heaney v. St. Joseph County Assessor, Pet. No. 71-001-08-3-5-00001 (April 19, 2012) (March 1, 2008 assessment).  The Indiana Board held that it has statutory jurisdiction over property tax credits under the correction of error statute, Ind. Code § 6-1.1-15-12 (the Form 133 Petition), which allows for the review of any credit permitted by law.  Although “tax cap” suggests that it is a limit on property taxes, the cap is actually a credit for all taxes above a certain percentage.  See (Pages 5-6, ¶¶ 10-12.)

Indiana Board lacked jurisdiction to rule on property’s assessments for years not under appealLHC Partners, LLC v. Montgomery County Assessor, Pet. No. 54-009-08-1-5-00043 (Dec. 3, 2012) (March 1, 2008 assessment).  “To the extent that the Petitioner’s witness suggests that the Board should reduce the Petitioner’s property’s 2009, 2010, 2011 or 2012 assessed values, those assessment years are not before the Board in this appeal.  And the Board has no jurisdiction to change an assessment that is not on appeal before it.”  (Page 11, ¶ 30 n.8) (citing Whetzel v. Department of Local Government Finance, 761 N.E.2d 904, 908 (Ind. Tax Ct. 2001)).

And if it’s Not about Taxes . . . No Jurisdiction

Indiana Board has no jurisdiction to hear complaints regarding city servicesPotter v. Tippecanoe County Assessor, Petition Nos. 79-032-10-1-5-00001 et al. (Dec. 21, 2012) (March 1, 2010 assessment).  The Board explained, “Ultimately, the Petitioner’s issue is with the subdivision’s location on a ‘private drive’ and the lack of city services the properties receive as a result of that designation.” (Page 8, ¶ 15(h).)  The Board lacks jurisdiction over the provision of city services to Owner’s duplexes.  Id.

Not a Dull moment. Indiana Board sua sponte rules that it lacked jurisdiction to hear appeal challenging statutes addressing budget levy and local option income taxesDull v. Lake County Assessor, Pet. No. 45-044-10-3-5-00176 (Jan. 23, 2013) (March 1, 2010 assessment).  Property owners challenged the constitutionality of two statutes (Indiana Code § 6-1.1-18.5-2(c), Indiana Code § 6-3.5-6-32(j)) freezing Lake County’s tax levy unless a local option income tax is passed and removing the ability to pass such a tax by the Lake County Income Tax Council.  With this freeze in place, the Owners asserted, Lake County cannot provide the same level of services as it did in 2007 – an impact felt by every local governmental unit and the county.  They argued the statutes violate various federal and state constitutional provisions, including that the statutes constitute impermissible special legislation.  Owners did not contest the assessed value of the property under review.  The Indiana Board declined to reach the merits and sua sponte concluded that it lacked jurisdiction over Lake County’s budget or local income tax issues.  (Page 9, ¶ 18.)  The Board reasoned that “while arguably the county’s maximum budget levy has some impact on the property taxes the [Owners] paid in 2010, the Board has no jurisdiction over property taxes or tax rates.”  Id.

Taxpayers may not challenge their tax rates or bills before the Board.  Irvin v. Perry County Assessor, Pet. No. 62-003-10-1-5-00013 (Jan. 31, 2013) (March 1, 2010 assessment)  [Small Claims Docket].  “The Board can address appeals from determinations made by local assessing officials or county PTABOAs [i.e. the local review board] that concern property valuations, property tax deductions, property tax exemptions, or property tax credits.  No statute authorizes the Board to review tax rates or tax bills. Therefore, to the extent that the Petitioner may have attempted to contest his tax liability, the Board lacks jurisdiction.” (Page 5, ¶ 15(a))  (citing Ind. Code § 6-1.5-4-1(a)).

File on Time (and be able to Prove It)

Non-attorney, non-certified tax representative son allowed to represent taxpayer-mother; Form 131 timely where PTABOA failed to mail Form 115 notice to son’s addressCastleman v. Steuben County Assessor, Pet. No. 76-006-10-1-5-00023 (Jan. 11, 2013) (March 1, 2010 assessment).  Taxpayer’s son represented her at the Indiana Board’s hearing.  The son was not an attorney or a certified tax representative.  Because the mother appeared at the hearing, she could call the son as her witness.  (Page 1, ¶ 4 n.1.)  Assessor did not object to the son offering exhibits and making arguments.  The Board concluded that the mother “appears to have ratified [son’s] actions by her silence.”  Id

Assessor argued that mother’s Form 131 appeal petition to the Board was untimely, because it was filed more than 45-days beyond the date the Form 115 notice of the PTABOA’s final determination was issued.  (Assessor objected to mother’s exhibits and to the Board holding a hearing; the Board treated this as an oral motion to dismiss the appeal based on an untimely filing.)  (Page 3, ¶ 10 n.2.)  The Form 115 was issued December 29, 2011, and the mother’s appeal petition was filed February 24, 2012 – more than 45 days later.  But the PTABOA hadn’t mailed the notice to the son’s address, even though the son was the mother’s representative before the PTABOA (a fact noted on the Form 115), the PTABOA treated him as such, and his address was on the Form 130 petition.  Under these circumstances, the Board held, “the time for [mother] to file a Form 131 petition did not begin to run until the PTABOA gave [son] notice of its determination.”  (Page 3, ¶ 12.)  The PTABOA’s erroneous mailing “did not constitute notice.”  (Page 4, ¶ 13.)

PTABOA miscalculated 45-day appeal period; Taxpayers’ petitions were timely.  Orear v. Dearborn County Assessor, Petition Nos. 15-020-11-1-5-00584 and -585 (Feb. 7, 2013) (March 1, 2011 assessment) [Small Claims Docket].  Form 11 assessment notices were issued on September 14 or 15, 2011.  The PTABOA determined that the 45-day appeal period ended October 28, 2011.  Because the Homeowners’ Form 130 petitions were received on Oct. 31, 2011, the PTABOA refused to act on the appeals, claiming they were untimely.  The PTABOA instructed the Homeowners to file Form 131 petitions to the Indiana Board.  The PTABOA was wrong.  (Page 4, ¶ 20.)  It “clearly miscounted the days.”  (Page 5, ¶ 21.)  The record did not contain copies of the 2011 Form 11 notices, but the Assessor testified that Homeowners “would have gotten notice on either September 14 or 15, 2011.”  (Page 5, ¶ 21) (Footnote no. 2 expresses the Board’s skepticism as to the sufficiency of this testimony to prove the date notice was received.)   But 45 days after September 14th is October 29th, a Saturday.  Because it was undisputed that the appeals were initiated on Monday, October 31, 2011, the Board held they were timely filed. (Page 5, ¶ 21.)

Failure to timely initiate appeal was a “fatal mistake” making the Board’s review process “unavailable” where PTABOA refused to hear appeal.  Huismann v. Dearborn County Assessor, Petition No. 15-007-11-1-5-00579 (Feb. 13, 2013) (March 1, 2011 assessment) [Small Claims Docket].  The Form 11 assessment notice assessing Homeowners’ property was dated September 14, 2011.  They had 45-days from that point – until October 29th (or, as noted above, until October 31st because of the 45th day falling on a Saturday) – to file an appeal.  Homeowners’ admitted they “missed the date” by filing their appeal on November 14, 2011.  (Page 4, ¶ 14.)  The approximate two-week delay was a “fatal mistake.”  (Page 4, ¶ 15.)   Because the initial appeal was untimely, review of the PTABOA’s decision not to consider modifying the assessment was “unavailable.”  Id.

Without “substantial evidence” of timely filing, Indiana Board could “grant no relief.”  Kirk v. Dearborn County Assessor, Pet. No. 15-006-11-1-5-00564 (Feb. 20, 2013) (March 1, 2011 assessment).  In yet another appeal from Dearborn County, Homeowner had until October 31, 2011 to initiate an appeal.  Her letter to the Assessor was dated October 31st, but the record contained no evidence as to when the letter was actually filed (the Board notes that the postmark date on U.S. first class mail is prima facie proof of the date of filing, see 52 IAC 2-3-1(c)).  The Assessor testified that he received the letter on November 3, 2011.  Homeowner did not dispute this.  Based on this testimony, the Board could “only conclude that the letter could have been mailed on October 31, November 1, or November 2.”  (Page 7, ¶ 29.)  Even though the timeliness of her filing was the reason for the PTABOA’s denial, Homeowner “provided no evidence or argument to establish an exact filing date.”  (Page 7, ¶ 30.)  The “ambiguous record” failed to substantiate her claim.  Id.  Homeowner failed to start the appeal process on time; the Board therefore could “grant no relief.”  (Page 8, ¶ 33.)

PTABOA dates Form 115 notice five months before issuing decision; Taxpayer dates Form 131 after it was sent; Despite the confusion, petition was timelyWhysong v. Steuben County Assessor, Pet. No. 76-008-10-5-00002 (Feb. 27, 2013) (March 1, 2010 assessment) [Small Claims Docket].  This appeal saw dating mistakes by the PTABOA and the Taxpayer, who challenged the assessed value of a vacant lot.  First, the PTABOA listed June 13, 2011, as the date it issued the Form 115 notice of its final determination.  But the notice was not issued until November 30, 2011.  The Indiana Board initially issued a notice of defect regarding Taxpayer’s Form 131 petition based on the incorrect date, but it set the appeal for hearing after learning of the PTABOA’s error.  (Page 1, ¶ 3.) 

The earliest possible due date for Taxpayer’s Form 131 petition was January 17, 2012 (and it may have been the 18th based on a post-marked envelope presented by Taxpayer).  (Page 5, ¶¶ 13(a), (b) n. 4, 5 (citing 52 IAC 2-3-1)).  To compound the confusion, Taxpayer dated his Form 131 Petition January 23, 2012, and it was stamped as received by the Indiana Board on January 25, 2012.  But the Board originally received the petition in an envelope postmarked January 12, 2012, and stamped it as received January 17, 2012.  Accordingly, the Board accepted these two dates and found the petition to have been timely filed.  (Page 6, ¶ 12(d).)

Jurisdiction and Property Tax Exemptions

Indiana Board lacked authority to hear Form 132 petitions filed more than 45 days after receipt of tax bill.  In GCH, LLC v. St. Joseph County Assessor, Pet. No. 71-018-09-2-8-00004 (March 19, 2012) (March 1, 2008 and 2009 assessment dates), the Indiana Board of Tax Review considered the application of a property exemption in a case with a “convoluted history.” (Page 1, ¶ 1.)  The property was transferred to the owner GCH, LLC (GCH) sometime after August 2008.  During the relevant periods at issue, the property was leased to the United States Social Security Administration.  It had received the exemption for several years.  Only upon receipt of the November 2009 tax bill did GCH receive notice that the exemption had been removed.  On March 17, 2010, GCH filed a Form 132 appeal petition with the Assessor.  In November 2010, GCH mailed a Form 132 petition to the Indiana Board.  GCH’s filings, the Board noted, “have caused much confusion,” and “other things have contributed to the procedural morass” facing the Board. (Page 6, ¶¶ 18 & 19.)  Those “other things” included: (1) the property’s exemption had been removed without notice to the taxpayer; (2) the property tax appeal statutes “do not spell out how a taxpayer should challenge such an action”; (3) GCH initially filed Form 132 petitions in different places and did not fill in the assessment date at issue on one petition; and (4) GCH ignored the Board’s notice of defects regarding the Form 132 petitions. 

The Indiana Board dealt only with the procedural issue before it, i.e. whether procedural defects prevented the Board from reaching the merits of GCH’s exemption claim.  The Board observed that it knew of no statute which excused GCH from filing an exemption application (a Form 136).  (Page 8, ¶ 24.)  And GCH could not rely upon the apparent errors of local officials in applying the exemption without an application.  (Page 8, ¶ 25.)  While GCH’s failure to file Form 136 applications for 2008 and 2009 “might be a good defense” to its claims for exemption, the Board concluded that GCH was required – and failed – to file its Form 132 petition within 45 days of receipt of the tax bill showing removal of the exemption.  (Pages 11 & 12, ¶ ¶  31 & 33.)

Trial court’s injunctions from the 1970s didn’t bind Assessor, PTABOA or Indiana BoardLocal Union 414 International Brotherhood of Teamsters v. Allen County Assessor, Pet. No. 02-074-08-2-8-00014 (Dec. 3, 2012) (March 1, 2008).   In the appeal of the denial of a property tax exemption for a union’s office and meeting facility, the union asserted that decisions rendered by Marion County courts decades ago found labor unions to be tax exempt.  These decisions applied to all Indiana assessors, the union argued.  (Page 9, ¶ 17(D).)  The union asked the Indiana Board to take judicial notice of several injunctions issued by the Marion County Superior Court in the 1970s.  (Page 18, ¶ 32.)  The Board observed:  “Because the Indiana Tax Court has exclusive jurisdiction over any case that arises under the tax laws of Indiana, it is not clear how decisions from a court with no jurisdiction over property tax matters could be binding on the [Assessor], the Allen County PTABOA or the Indiana Board of Tax Review.”  Id.   In a footnote, the Board cited to a 2008 Indiana Court of Appeals decision noting that the Tax Court has exclusive jurisdiction over tax appeals and finding that the Marion County Superior Court lacked jurisdiction to order a property tax refund.  (Page 18, ¶ 32 n.5) (citing Marion County Auditor v. Revival Temple of Apostolic Church, 898 N.E.2d 437 (Ind. Ct. App. 2008)).

Indiana Board could not enforce parties’ contract; Church bought property after May 15th and thus failed to file a timely Form 136 exemption applicationBrazil First United Methodist Church v. Clay County Assessor, Pet. No. 11-011-10-3-5-00001 (Dec. 18, 2012) (March 1, 2010 assessment date).   Church bought property on Oct. 21, 2010.  On April 5, 2011, the Church filed a Form 133 Petition for Correction of an Error, stating it only owned the property for two months in 2010 and should not have to pay taxes for 12 months.  The Church argued that its purchase agreement with seller limited its 2010-pay-2011 tax liability.  Church “appears to ask the Board to impose that agreement on the county.” (Page 6, ¶ 19.)  The Board explained, however, that “no statute authorizes the Board to review or enforce the private contract rights or obligations of buyers and sellers in real estate transactions.”  (Page 7, ¶ 20.)  And the Board held that denying the 2010 exemption because of an untimely application was not an error, where the law “clearly specifies” that applications must be filed by May 15th for the year in which an exemption is sought.  (Page 9, ¶¶  26, 27.)

House used for charitable and religious purposes found taxable; exemption waived where application filed too late.  Servants of the Streets FWTC, Inc. v. Elkhart County Assessor, Pet. No. 20-009-10-2-8-00001 (Feb. 26, 2013) (March 1, 2010 assessment).   The filing date for a Form 136 property tax exemption application is May 15th.  For the March 1, 2010 assessment date, Servants of the Streets filed its application on June 4, 2010, and it presented no evidence that the property had been previously exempted (property that has previously been exempted for charitable or religious purposes may not have to re-file an exemption application if the property’s physical status and use have not materially changed).  Servants of the Streets asked the Indiana Board to “find a way to waive the filing deadline.”  (Page 7, ¶ 23.)  There was no dispute that the property was used for charitable and religious purposes, but the Board was compelled to find that Servants of the Streets had waived its right to an exemption.  (Page 7, ¶ 24.)  The house was 100% taxable.  Id.

(Photo used under Creative Commons from Eugene Zemlyanskiy.)


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