Senior freeze a property-tax bargain in Oklahoma
BY CURTIS KILLMAN World Staff Writer
Monday, March 04, 2013
3/04/13 at 7:34 AM
Read details of the senior property
tax freeze program, learn whether you
qualify and find out how to apply.
Frank Swain's property taxes have increased 64 percent in the past seven years.
Caused by both increases in the value of his home and millage rates, the amount he paid Tulsa County has crept up each year - from $157 in 2005 to $258 in 2012, records show.
The 74-year-old said he definitely noticed the recent increases.
"All I know is I've been hit in the pocket for something," Swain said.
But had Swain, when he turned 65, signed up for a little-known state program called the senior valuation freeze, he could have locked in the taxable value of his home nine years ago and severely limited his increased tax burden.
"You're giving me information about something that I wasn't aware of," Swain said, when told about the program.
Swain is not alone.
A Tulsa World analysis shows that thousands of Tulsa County property owners who meet certain income limits are not taking advantage of the tax limiting program on the books since 1996.
A World review of Tulsa County Assessor data shows that about 16,000 homeowners are signed up for the senior valuation freeze or valuation limitation.
Since 2008, Tulsa County home-owners currently with the senior valuation limitation have shielded nearly $935 million from taxation through the program, a World analysis of property records indicates.
Yet perhaps as many as 5,000 other Tulsa County homeowners are failing to take advantage of the same state program, according to a World analysis.
Those who own homes worth as much as $800,000 have legally frozen their taxable values at much lower levels, saving hundreds and sometimes thousands of dollars on their tax bills.
The savings can be substantial over time.
A person whose home was worth $51,291 in 2000 and $90,400 now would pay about 50 percent less in property taxes today, had the senior freeze been in place the past 13 years.
Lou Hinshaw qualified for the senior valuation freeze 11 years ago, but it took a chance encounter last year for him to learn about the program. Hinshaw, 76, said he first found out about the program after he called the County Assessor's Office to discuss his latest property tax increase.
During the discussion, Hinshaw said the assessor office employee suggested that he might qualify for the senior valuation freeze program. He did and now Hinshaw has frozen the taxable value of his property.
"Think of all the money I wasted giving it to the government," Hinshaw said.
Patrick Milton, chief of staff to Tulsa County Assessor Ken Yazel, said some people unfortunately do not take advantage of existing government programs that could save them money.
"There are lot of people who don't want to deal with government under any circumstances," Milton said.
First approved by voters in 1996, the measure permits senior householders after they turn 65 to freeze the value of their home for tax purposes if they meet certain income limits.
Income limits are linked to the county median household income as determined by the U.S. Department of Housing and Urban Development. For Tulsa and surrounding counties, the current income threshold is $60,400.
Applications for the senior freeze must be submitted between Jan. 1 and March 15 of each year or within 30 days of issuance of a "Notice of Change in Assessed Value of Real Estate."
The senior valuation limitation locks in the valuation of the property but does not necessarily freeze taxes.
Tax amounts could still change. Additional millage or levies could be added by the Tulsa County Excise Board, a judgment could be taken against the county, or voters might modify assessment percentages set forth in the state Constitution.
When initially approved by voters in 1996, the senior freeze limited the program to households with an annual gross income up to $25,000.
Voters added the HUD median income clause for determining income thresholds in 2004.
Since then the number of higher valued properties to join the program has skyrocketed.
In Tulsa County, residents taking the senior valuation in 2013 have property values ranging from $3,900 to $812,500.
The number of properties valued at $200,000 or more has nearly tripled since 2005, records show.
In 2005, almost 4,000 properties had a market value of $100,000 or more.
That figure has jumped to more than 6,500 this year.
A spokesman for Yazel declined to comment on the propriety of freezing taxes for upscale homes.
Each homeowner who signs up for the program is subject to the same income verification standards, said Keith Hulsizer, chief deputy for the Assessor's Office.
Hulsizer and other members of Yazel's staff pointed to a variety of factors that might be affecting the number of residents not applying for the senior freeze.
Hulsizer said the number of homestead exemptions, a requirement for seeking the senior freeze, has been steadily declining in recent years.
Properties in company names or irrevocable trusts are also not eligible for the senior freeze, Hulsizer said.
Information about the senior freeze and other tax limitation programs is included in correspondence sent to property owners, Hulsizer said. Forms and details about the program can be found on the assessor's website.
Hulsizer said he, Yazel and other members of the office staff routinely give speeches that include information about the tax limitations.
Hulsizer said an increase in tax limitations such as the senior freeze doesn't necessarily mean tax revenue will decline.
Rather, in some cases, it shifts the burden of taxes from those who are limited to those who are not limited or capped.
"Anytime you suppress growth in tax valuations you are making the average Joe pay a little bit more," Hulsizer said.
Statewide, an estimated 94,000 properties are enrolled in the limitation program, according to data from the state Tax Commission.
Still, one state representative wanted to do away with the income limitation altogether for homeowners older than 65.
Rep. David Dank, R-Oklahoma City, introduced a House Resolution this year that would have abolished the HUD income limits.
The bill, House Joint Resolution 1009, would have placed a state question before the people to amend the constitution to abolish the income limits.
Tax Commission officials estimate Dank's proposal would have meant an additional 78,000 homeowners would qualify for the limitation in 2014, if approved by voters.
The measure would have reduced future growth in state ad valorem revenues by an estimated $2.7 million in 2014 and increased beyond that over time, according to the state Tax Commission.
The measure failed to make it out of committee and is apparently dead for the session. Dank could not be reached for comment.
Senior Valuation Freeze
(freezes taxable value of home)
Age to qualify: 65
Maximum household annual income (metro area): $60,400
Deadline to apply: March 15
Median market value of currently qualified Tulsa County homes: $90,400
Number of Tulsa County households currently with Senior Freeze: 16,055
Number of additional Tulsa County households that might qualify: 5,000
Call for more information: Tulsa County residents can contact the county assessor's office at 918-596-5100 for more information about the senior valuation freeze, or limitation program.
Original Print Headline: Some seniors miss tax break
Curtis Killman 918-581-8471