GOSHEN — Time is ticking for almost 12,900 people in Elkhart County who have yet to confirm their eligibility for a tax break on their homes.
County auditor Pauline Graff said about a quarter of homeowners who claim a homestead deduction have failed to verify information that could help them save big bucks on their taxes. The deduction covers up to 60 percent or $45,000, whichever is less, of a home’s assessed value. Homeowners who don’t turn in a homestead verification form by Dec. 31 risk losing the deduction, Graff said. Not verifying the deduction could mean a large increase in property taxes for homeowners because they would have to pay taxes on the full assessed value of their home.
The county has mailed pink homestead verification forms with tax bills for the past three years. And for some reason or another, Graff said, some homeowners have not filled the forms out.
“If they don’t start getting here soon, they may end up standing in a line for two hours or more,” she said. “There could start being lines that go down the hallway and down the stairs.”
The forms were created after legislation passed requiring taxpayers who receive a homestead deduction to verify their eligibility for the tax break. The idea was to allow county government to improve its management over homestead filings.
People who don’t verify their deduction by the end of this year must prove that their address is their primary residence and wait for a refund on their taxes next year, county property compliance manager Kim Miller said. For proof, the county accepts the last five digits of the homeowner’s Social Security number, the last five digits of his driver’s license and his Indiana tax return.
But, Graff warned, refunds are not quick money.
“That’s not an overnight process,” she said. “We don’t sit here and cut checks immediately.”
These refunds could cause a financial headache for the county, Graff said. The more homestead deductions that are not verified, the higher the county’s total assessed value rises. This means more money flowing into the county from property taxes, but an overflow of homeowners requesting refunds can create problems.
“We can collect up to 102 percent of what the state has set all county budgets at,” Graff said. “Anything above that 102 percent goes into a special fund to be used to offset the following year’s collection. We can’t touch the money, and in the meantime, we have to give all this money out for refunds. The money has to come from somewhere.”
County commissioner Mike Yoder said he is worried that a large number of refunds would create a huge shortfall for the county that could add up to more than $1 million.
“We don’t have that kind of flexibility in our county budget,” he said.
The county auditor’s office plans to send a letter to taxpayers who need to verify their homestead deductions. In the meantime, the verification forms can be found online at www.elkhartcountyindiana.com and www.indiana-homestead.com.
For more information call the county auditor’s office at 535-6710 or 535-6720.
Where are the unverified homestead deductions?
Outside of city and town limits: 7,291