Owners of commercial, industrial and railroad properties need to file applications for a business property tax credit against their 2013 property tax assessments with county or city assessors by Jan. 15.
Applications received after Jan. 15 will be considered for the 2014 assessment year, according to the Iowa Department of Revenue. Once the initial application has been received and the credit allowed, property owners will not need to apply again unless the ownership or classification of all or part of the property changes.
Senate File 295 provides a tax credit for certain commercial, industrial and railroad properties. The credit is not available for residential or agricultural property.
A credit is available for each qualified property unit. A property unit consists of contiguous parcels of the same classification that are owned by the same person and operated by that person for a common use and purpose.
Hotels, motels, inns or other buildings where rooms or dwelling units are typically rented for less than a month are not considered primarily used for human habitation and qualify for the property tax credit.
If the rooms are typically rented for more than 30 days, the assumption is that they are “primarily used for human habitation” and do not qualify for the tax credit.
The actual amount of credit each property unit will receive depends in part on the total value of all property units and the average consolidated rates in each unit.
The credit calculation is intended to spend 98 percent of the amount appropriated by the Iowa Legislature to the Business Property Tax Credit Fund. For the first year of the credit, $50 million was allocated to the fund.
The maximum first year credit amount will be approximately $523, according to the Legislative Services Agency.