Washington Co. tax bills to be mailed out

Changes include a lower county tax rate for residents of municipalities and a supplemental tax credit for qualifying seniors

June 29, 2010|By HEATHER KEELS
  • Gary Koch moves a pallet of Washington County tax bills at Tri-State Printing Inc. More than 55,500 bills will be mailed out Wednesday.
Ric Dugan, Staff Photographer

WASHINGTON COUNTY -- Tax bills are set to be mailed Wednesday to 55,527 Washington County property owners, County Treasurer Todd Hershey said.

The bills, which should begin arriving in mailboxes Thursday, might reflect several changes implemented this year, including a lower county tax rate for residents of municipalities and a supplemental tax credit for qualifying seniors.

"With the tax bills coming out, there's two things that are substantial that the county is proud of and would like everyone to understand," County Administrator Gregory B. Murray said.

The first is that the county's tax rate did not go up, even though the constant yield rate -- the rate that would be required to keep tax revenue the same -- did increase, Murray said.

"Through budget cuts and careful management, we were able to keep our tax rate from going up," he said.

Tax differential

The second change Murray emphasized is the new "tax differential," which changes who collects some of the taxes for properties in Hagerstown and the county's eight towns.


In the past, municipal and nonmunicipal residents paid the same tax rate, but the county returned some of municipal residents' taxes to their municipal governments in the form of tax rebates, Murray said. That rebate was designed to cover services that municipal residents get from the municipality rather than from the county.

Now, the county will only collect tax from municipal residents for services those residents get from the county, such as education and the court system, he said.

The result is that while residents of unincorporated areas will continue to pay 94.8 cents per $100 of assessment, municipal residents will pay 82.3 cents per $100 of assessment -- 12.5 cents less.

However, because municipalities will no longer get rebates from the county, some have decided to raise municipal tax rates to compensate.

How much to raise municipal taxes was up to the municipal governments and ranged from no increase to the full 12.5 cents, Murray said. The county is still compiling a list of how the municipalities chose to adjust their tax rates, he said.

Senior tax credit

Another change accompanying this year's taxes is a county supplement to the state's Homeowners' Tax Credit Program for homeowners who are 70 or older and meet household income guidelines and other qualifications.

With that supplement, qualifying seniors whose income is $12,000 or less will not have to pay any county property tax, while those with incomes between $12,000 and $60,000 will see their county property taxes capped at a maximum amount, calculated based on their income.

As of the printing of the tax bills, the county had issued 618 of those supplemental credits to those whose applications had already been processed, Hershey said. Those supplemental credits totaled $62,908.24, or a little more than $100 per credit, he said.

Taxpayers who apply for the Maryland Homeowners' Property Tax Credit automatically are evaluated for eligibility for the county's senior supplement. Those who have not yet applied may do so through Sept. 1 and will be issued a refund to reflect the amount of the credit.

Applications are available at or from the State Department of Assessments and Taxation at 3 Public Square in Hagerstown or the Washington County Treasurer's Office at 35 W. Washington St., Suite 102, in Hagerstown.

Thos applications must be resubmitted each year.

Homestead Tax Credit

Homeowners whose properties were reassessed this January should have received an application for another credit, the state's Homestead Tax Credit, with their assessment notices. The Homestead Tax Credit limits taxable assessment increases for homeowner occupied properties to a fixed percentage each year -- 5 percent in Washington County.

This one-time application for the Homestead Tax Credit should already have been submitted by owners whose homes were reassessed in 2008 or 2009.

The Homestead Tax Credit is a source of confusion for some property owners because it may result in increasing tax bills even if the assessment and tax rate have not increased, Hershey said. That is because large increases from the boom years are still being phased in, he said.

"It's certainly hard to explain to the taxpayer why their total tax obligations are going up maybe 5 percent when their assessment has fallen and, in some situations in municipalities, their tax rates have fallen, too," Hershey said. "They should realize they've been receiving a tax credit and it's benefited them over many years, but now the credit they've accrued over those years is being spent."

Nonhomeowner-occupied credit

Another change taking effect this year is that the Homestead Tax Credit will be extended to the owners of some nonhomeowner-occupied properties, including condominiums, town houses and rowhouses, capping the increase in taxable assessments on those properties to 10 percent a year.

That change was applied automatically, with 2,318 nonhomeowner-occupied accounts receiving a total of $96,877.94 in credits, an average of $41.79 per account, Hershey said.

Even renters who do not pay property taxes directly may be eligible for credits from the state under a little-known Renters' Tax Credit program, Hershey said. Maryland offers credits of up to $750 to renters based on income and monthly rent. More information about that program and other tax credits is available at

Paying the bill

Tax bills are due by Sept. 30, but there are benefits to paying early, Hershey said. Taxpayers are eligible for a 0.5 percent discount on the county portion of their bills if they pay by July 31, he said. Interest charges of 1 percent per month begin Oct. 1, he said.

Bills for properties that are the owner's primary residence can be paid in two installments, generally in July and December, Hershey said.

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