Originally published on Forbes.com Aug 15th, 2013
If you form the wrong tax conclusion from listening to the radio or reading news stories, you might not get a break when you ask for relief. That is what happened to Richard Kennel in the New Jersey Tax Court. He had gotten the impression that New Jersey had cancelled its property tax reimbursement program, known as the “senior freeze”. He eventually got the straight story, but the initial misinformation caused his application to be a couple of weeks late.
New Jersey Senior Freeze
One of the greatest scams ever perpetrated on a society is the notion that “senior citizens”, as a class, are a disadvantaged group. I reached that conclusion when I was in my thirties. Getting a small taste of the benefits as a junior senior citizen hasn’t changed my attitude. Some great social purpose must be served by me paying less to go to the movies, I just have not figured out what it is.
New Jersey’s homestead property tax reimbursement program (PTR), which is also known as the “senior freeze”, does have a certain logic to it. According to this article, New Jersey has the highest per capita property taxes in the nation. The senior freeze applies
To qualify for the PTR program, an applicant must be at least sixty-five years of age or must be disabled, meet certain income limits and who, as a “homeowner, has made a long-term contribution to the fabric, social structure and finances of one or more communities in this State, as demonstrated through the payment of property taxes … on any homestead … used as a principal residence in this State for at least 10 consecutive years at least three of which as owner of the homestead for which a homestead property tax reimbursement is sought prior to the date than an initial application for a homestead property tax reimbursement is filed.
So if you have paid New Jersey’s high property taxes for ten years you are entitled to some consideration in being able to spend your retirement years in the Garden State and not be forced into joining the Sun City cult.
Late Can Be As Bad As Never
Mr. Kennel was required to file for his 2010 property tax rebate by November 7, 2011. His application went in over a month late, because of his mistaken impression that the program had been cancelled. Him being a senior citizen and all, it would seem that he should be entitled to a break, but no such luck. There are only two acceptable excuses for being late.
n order to establish good cause to extend the time of any applicant to file a claim for a homestead rebate or credit the applicant shall provide to the director either medical evidence, such as a doctor’s certification, that the claimant was unable to file the claim by the date prescribed by the director because of illness or hospitalization, or evidence that the applicant attempted to file a timely application. Except as may be established by medical evidence of inability to file a claim, good cause shall not be established due to a claimant not having received an application from the director.
There were two arguments that Mr. Kennel made to the New Jersey Tax Court. The first was that it was unconstitutional for New Jersey to tax senior citizens at the full rate and then give some of the money back. According to the argument that forced loan is a taking. The second argument was that the application extensions were not adequate especially when the confusing news reports are taken into account.
As far as the first argument went the Tax Court ruled:
The PTR program confers a monetary tax benefit to qualified taxpayers. Therefore, denial of a PTR application does not involve an unlawful governmental taking because it is a denial of a tax benefit, not a taking of private property. This court holds that requiring taxpayers to fully pay their property tax bills before being able to request relief under the PTR program is not a violation of the Fifth Amendment Takings Clause nor the analogous provision provided in the New Jersey State Constitution.
As far as the second argument goes, the answer was that there are two exceptions and he did not meet the criteria for either:
This court finds that there are only two limited exceptions to timely filing a PTR application: (1) unable to timely file due to medical issues and (2) evidence that the applicant attempted to timely file. Plaintiff’s defenses do not fit into either of these circumstances and the Director has no statutory discretion to make an exception for plaintiff. Plaintiff’s contentions that he mistakenly believed the PTR program to be cancelled and that he did not receive a 2010 PTR application in the mail are not valid reasons to excuse compliance with the statutory filing requirement.
I’m not really sure whether this was a fair result, but the lessons are clear. Try to check things out with official sources and avoid procrastination.
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