For the second straight year, the DC Office of Tax and Revenue increased the Homestead Deduction benefit from $69,100 to $70,200 for those DC residents who own and occupy their property as their principal residence. This results in an annual property tax bill reduction of $596.70.
Per the DC Office of Tax and Revenue, in order to qualify for the deduction, the homeowners must:
- Submit an application with the Office of Tax and Revenue;
- Occupy the property, and the property must not contain more than 5 dwelling units (including the unit occupied by the owner); and
- Use the property as their principal residence
If the DC property owner files an application and it is approved by the Office of Tax and Revenue between October 1 and March 31, the benefit will be granted to the homeowner for the entire tax year and all future tax years.
If the application is filed and approved between April 1 and September 30, the benefit will be granted for the second half tax bill of that year and all future tax years.
You can complete the new form online, or visit the Office of Tax and Revenue’s Homestead Deduction website link for additional information.
If you are an agent, broker, or mortgage lender who has been solicited by a title company to enter into a Marketing Service Agreement (MSA), you would probably be best served to avoid the temptation.
The Consumer Protection Financial Bureau (CFPB) has made it clear that they are actively probing and investigating such arrangements as one of their top priorities. Most recently, an MSA between a top Maryland real estate team and their “partner” title company resulted in a massive class-action lawsuit and, potentially, an enforcement action by the CFPB (see full story
Federal Title has actively taken a strong stance against both MSA’s and Affiliated Business Arrangements (ABAs), recognizing that such arrangements only enrich the referral sources at the expense of the consumer and further drive up the costs of title charges. Read our related articles on MSAs and ABAs.
Did you know that the District of Columbia provides a substantial discount on real estate property taxes for seniors?
If eligible, a senior can save 50% on his or her property tax bill. Further, the threshold for the income level was raised to its current level on October 1, 2013 (previously the threshold was $100,000), so some seniors who were unable to qualify previously might want to take another look at their eligibility.
To be eligible:
- At least one owner of the property must be 65 of older;
- The total household adjusted gross income must be less than $125,000; and
- The senior must have at least 50% ownership of the property to qualify.
Keep in mind that if the senior no longer occupies the property, or if any of the above eligibility requirements are no longer met, a cancellation form must be submitted to the DC Office of Tax and Revenue within 30 days of the change in eligibility.
Failure to do so could result in the DC Office of Tax and Revenue applying penalties and interest.
The Senior Citizen Tax Relief application can be found the DC Office of Tax and Revenue website.
Maryland law requires the seller to provide specific information pertaining to the resale of property within a Homeowner’s Association (HOA) or a property designated under a condominium regime.
Typically, this information is produced by the management for the HOA or condominium, and the HOA or condominium charges the seller a fee for the production and delivery of the information.
It is the belief of some Maryland legislators that the fees being charged are excessive and, as such, these legislators are seeking to limit the amount that may be charged.
Before the Maryland legislature are bills S229/HB412, which would limit the fee a condominium council of unit owners or HOA may charge an owner (seller) for providing this legally required information to a prospective homebuyer.
The current law calls for a "reasonable fee," but it is left undefined so many organizations have simply been using the requirement as a way to profit – charging upwards of $400 to $500.
There's currently a proposal to limit the fee to $50. Hearings on the legislation continue and we will keep you apprised of the final bill.
UPDATE: The Senate passed SB 229. They amended HOA’s out of the bill, thus making it applicable only to Condo Associations; and they upped the fee that could be charged from $50 to $100. The House Committee then amended the bill further, but the Senate committee refused to concur with those amendments and so the bill died when the clock ran out at midnight.
An often overlooked provision in paragraph #6 of the GCAAR Regional Sales Contract provides that the "Purchaser agrees to contact the Settlement Agent within 10 Days after the Date of Ratification to schedule Settlement and to arrange for ordering the title exam and, if required, a survey."
Homebuyers and their agents should pay particular attention to this requirement.
Recently our office was notified that a seller had declared the purchaser in breach of contract due to purchaser's failure to schedule settlement within 10 days from the date of ratification.
While the purchaser had ordered a title exam with our office, neither he nor his agent had scheduled the settlement date.
Through email notification, Federal Title reminds homebuyers and their agents to schedule the closing with our office within this time period. Unfortunately, in this particular instance, our notifications were ignored.