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Sharing home impacts tax exemption

Posted: April 11, 2013 - 2:33pm  |  Updated: April 12, 2013 - 9:02am

The cover story on April’s AARP magazine is: “Saving Money by Living Together.” Well, I’m the patriarch of a combined 3 generation family here in Nikiski. My children and grandchildren live in my house. The State of Alaska has touted its $300,000 property tax exemption for folks over 65. I qualify, but for the past couple years my exemption has been reduced by thousands of dollars because my children live with me. Don’t misunderstand. I’m grateful for the exemption, but I wonder how many other families in the Borough are combined to save money and if other families have had their exemption reduced because of a combined family.

Instead of penalizing elderly parents, the borough ought to urge adult children to remain in Alaska. What gives? I’ll await a reply and an explanation.

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Suss 04/12/13 - 01:45 pm
Single Home, or Multiple Structures

I don't see the KPB reducing your tax exemption for having family live in your home, under the same roof of the abode that you reside in, this does not happen. On the other hand having more than one structure or multiple residences on your property that you can call "my house" because you own them and having family live in the independent house, not under the roof with the qualifying senior, does not seem to fit the concept behind the senior exemption for the singular, primary home residence. What about bunkers and doomsday bug-out buildings, did they get exemptions also or are they not visible to the assessor’s office?

leewaytooo 04/13/13 - 02:15 am
if the "family" members are

if the "family" members are receiving "aid" of any kind
from the government then they had to give a physical
address. that is the primary means in which the
borough would know that anyone is housing more
than themselves....

is rent being exchanged... utilities being paid....

maybe that is why......

leave it to the psychotics amongst us to complain
that the "gov ment" isnt being fair....

"i want more and i want to be able to complain while doing

Media Critic
Media Critic 04/15/13 - 06:46 am
With no disrespect to seniors

I've never understood a blanket tax exemption for seniors in the first place. The assumption seems to be that all seniors need the extra financial support. This leaves a single working mom in her 20s working at Sal's paying full boat on her property tax while someone like Bob Penny is getting a partial free ride. Doesn't make sense to me. The other assumption is that "they built this state so they deserve a break." While true for some, it's certainly not true for all.

KASchmidt 04/15/13 - 03:21 pm
Suss says: "I don't see the

Suss says: "I don't see the KPB reducing your tax exemption for having family live in your home, under the same roof of the abode that you reside in, this does not happen."

I have to disagree with you.

The senior residence exemption from property taxes is a mandatory exemption under Alaska law, up to $150,000 in assessed value. In 1986, Kenai Peninsula Borough voters approved an additional optional exemption, over the $150,000, with no value limit. Over the years, various amendments to the Borough Code sponsored by the Borough Administration and Assembly members have reduced and restricted the senior residence exemption. Recent Borough Assessors have taken a hard line approach, "interpreting" the state statute and Borough code to deny the exemption entirely or in part. The rejected senior has to appeal the denial and that is very expensive and difficult.

So it is entirely possible that the Borough Assessor has denied Mr. Olson his full exemption based on the fact that he has extended family members who share his residence.

I personally don't have a problem with the exemption (I am not a senior). The idea behind the exemption to begin with was that seniors could be land rich and cash poor, and might lose their homes to foreclosure. It was debated whether to make the optional exemption means-based, but that idea was rejected because people didn't want to make seniors feel like beggars.

Kristine Schmidt

Suss 04/15/13 - 06:10 pm
Which Residence?

Olson has more than one residence on his property, if the assessor found his extended family lives separately from the exempted senior or communally as in a compound of various buildings why should he get a full exemption? Further if the compound has numerous people using borough schools, hospital, roads, etc. he should be taxed fully.

I am aware anything is entirely possible but having seniors denied for their family living with them is a stretch. I agree that a senior that hands off their property to their children and continues ownership should not be exempt. I am also aware of many exempted seniors with adult children or adult grandchildren or siblings returning to live with them that could be impacted with an exemption reduction but since they do not have family compounds or brag about their status, the exemption has not changed. I do not see the assessor hunting down these violators that were helpful to family or just lonely and wanted company. What about those sinful seniors that are not married, is the assessor chasing the unmarried cohabitations?

So the lesson to seniors is do not have your boyfriend/girlfriend, children or other family or friends come live with you if they are no longer a minor when you want a senior exemption.

From the KPB form for the senior exemption.

Is occupancy shared with someone other than your spouse and/or minor children?
No Yes
If yes, when did shared occupancy begin?
Date ________________
What percent of the home do they occupy? _______ %
If live in care is medically necessary, attach letter from the doctor.

Maybe Militia Norm should compare notes with Bob Penney on compounds and taxes, or bunkers versus wine cellars.

Norseman 04/16/13 - 07:23 am
As much as I despise the

As much as I despise the "militia", norm does have a point.

I am not quite there yet to receive this "government backed" incentive, but I do not see what difference it makes whether you are a senior living alone in your home, or have your extended family there also.

All of us just want to pay our fair share of the taxes, no more than the other guy.

I guess I just can't see on what the difference is and how it may effect the taxes of others.

If norm is ok with living with his grownup kids, then so what. If they wish to live at home with thier parents, so what.

I love my kids and grandkids but don't want them moving back in.

Someone enlighten me as to why the restriction and perhaps I'll change my mind, otherwise I hate to say it, boy howdy,... but for now I'll side with the patriarch.
Now excuse me while I go shower....

Suss 04/16/13 - 10:56 am
Senior Exemption

Assume that after age 65 one is no longer in the workforce and living on pension, social security or simply put a fixed income that is substantially less than when a fulltime wage earner. Property taxes can take a bite out of that limited income. Now assume an adult wage earner under 65 living with the exempted senior is contributing substantially to the household monetary costs. That is the difference. In today’s reality the unfortunate truth is the senior is probably paying the whole load of the younger generation’s share and then some. I know I am still considered the “Bank of Dad” for all my kids’ needs for a lender.
In Olson’s case does anyone else contribute to the household costs, ie: heat, lights, food, maintenance and on and on and on as the costs never end when you’re an owner.
The costs to the Borough do not seem to be going down and the need for more is the constant refrain.

leewaytooo 04/18/13 - 03:25 am
it would seem that the 20

it would seem that the 20 acre parcel contains two homes..
one built in 76 with 5524 square feet and a newer
home built in 07 with 1888 square feet for a combined
value of 611,200....

so whats the beef???

cake and eat it too?

cant sell the land under the newer home?

used the first home to finance the second?


leewaytooo 04/18/13 - 07:15 am
It would seem from the data,

It would seem from the data, that in the tax year prior to
reaching 65 the property tax was 5348.42…

with the exemption

the tax reduced to 3320.38 the first year.

second year reduced again to 3274.84.

in the tax year of 06 just prior to the new house being built

the property tax was 3986.40.

so with two homes totaling 7412 square feet on 20 ac. the tax savings is 711.56 vs what was taxed in 06 with just one house and a 2200 square ft barn.

this is info through 2012 yr.

the tax exemption provides for a reduction of 2073.58 from peak tax prior to age 65

this amounts to a reduction of 38.76995449123292%

so again, whats the beef?????

Suss 04/18/13 - 07:39 am
Subdivide Compound

Subdivide the senior residence from the non-senior residence in the compound, then replat the two parcels with the Borough. They might need an as-built that includes bunkers, tunnels, floor plans depicting all interior and exterior walls, windows, doors, access doors, window and door schedules, openings, skylights, exposed beams, stairs, soffits, built-in casework, attached decks, balconies and patios
Mechanical and Electrical Layouts depicting plumbing fixtures, HVAC register locations, power, data, TV, communication outlet locations, lighting layout with switches.
Roof Outline depicting valleys, ridges, hips, slope drainage, parapet walls, chimneys.
Exterior Elevations depicting all visible elements such as posts, walls, windows, doors, openings, stairs, railing, roof exterior siding, doors, windows and ceiling heights. Militia approved surveyors are available in your area.

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