Washington Administrative Code › Title 458 - Revenue, Department of › Chapter 458-16A - Property tax-Exemptions-Homes for the aging, senior citizens and disabled persons › Section 458-16A-010 - Nonprofit homes for the aging

Current through Register Vol. 24-14, July 15, 2024
(1)
Introduction.
Under
			 RCW
			 84.36.041, a nonprofit home for the aging may
			 be totally or partially exempt from property tax. This section explains the
			 exemptions allowed and the criteria that must be met in order to receive an
			 exemption under this statute. Throughout this section, all requirements will
			 pertain to all types of homes for the aging including, but not limited to,
			 adult care homes, assisted living facilities, continuing care retirement
			 communities (CCRC), and independent housing, unless a particular type of home
			 is separately identified.
(2)
Definitions.
For purposes of this section, the following
			 definitions apply:
(a) "Acquisition" means
			 that an existing home for the aging (or home) currently in operation is
			 acquired by a nonprofit organization and the ownership of the facility will
			 change as a result of a purchase, gift, foreclosure, or other method.
(b)"Assistance with activities of daily
			 living" means the home provides, brokers, or contracts for the provision of
			 auxiliary services to residents, such as meal and housekeeping service,
			 transportation, ambulatory service, and attendant care including, but not
			 limited to, bathing and other acts related to personal hygiene, dressing,
			 shopping, food preparation, monitoring of medication, and laundry
			 services.
(c)"Combined disposable
			 income" means the disposable income of the person submitting the income
			 verification form, plus the disposable income of the person's spouse or
			 domestic partner, and the disposable income of each cotenant occupying the
			 dwelling unit for the preceding calendar year, less amounts paid by the person
			 submitting the income verification form or the person's spouse, domestic
			 partner or cotenant during the previous year for the treatment or care of
			 either person received in the dwelling unit or in a nursing home.
(i) If the person submitting the income
			 verification form was retired for two months or more of the preceding calendar
			 year, the combined disposable income of the person will be calculated by
			 multiplying the average monthly combined disposable income of the person during
			 the months the person was retired by twelve.
(ii) If the income of the person submitting
			 the income verification form is reduced for two or more months of the preceding
			 calendar year because of the death of the person's spouse or domestic partner,
			 the combined disposable income of the person will be calculated by multiplying
			 the average monthly combined disposable income of the person after the death of
			 the spouse or domestic partner by twelve.
(d)"Complete and separate dwelling units"
			 means that the individual units of a home contain complete facilities for
			 living, sleeping, cooking, and sanitation.
(e) "Construction" means the actual
			 construction or building of all or a portion of a home that did not exist prior
			 to the construction.
(f)"Continuing
			 care retirement community" or "CCRC" means an entity that provides shelter and
			 services under continuing care contracts with its residents or includes a
			 health care facility or health service.
(g)"Continuing care contract" means a
			 contract to provide a person, for the duration of that person's life or for a
			 term in excess of one year, shelter along with nursing, medical, health-related
			 or personal care services, that is conditioned upon the transfer of property,
			 the payment of an entrance fee to the provider of the services, and/or the
			 payment of periodic charges in consideration for the care and services
			 provided. A continuing care contract is not excluded from this definition
			 because the contract is mutually terminable or because shelter and services are
			 not provided at the same location.
(h) "Cotenant" means a person who resides
			 with an eligible resident and who shares personal financial resources with the
			 eligible resident.
(i) "Disposable
			 income" means adjusted gross income as defined in the federal Internal Revenue
			 Code, as amended prior to January 1, 1994, plus all of the following items to
			 the extent they are not included in or have been deducted from adjusted gross
			 income:
(i) Capital gains, other than gain
			 excluded from income under section 121 of the federal Internal Revenue Code to
			 the extent it is reinvested in a new principal residence;
(ii) Amounts deducted for loss;
(iii) Amounts deducted for
			 depreciation;
(iv) Pension and
			 annuity receipts;
(v) Military pay
			 and benefits other than attendant-care and medical-aid payments;
(vi) Veterans benefits other than
			 attendant-care and medical-aid payments;
(vii) Federal Social Security Act and
			 railroad retirement benefits;
(viii) Dividend receipts; and
(ix) Interest received on state and municipal
			 bonds.
(j) "Domestic
			 partner" means a partner registered under
			 chapter
			 26.60 RCW or a partner in
			 a legal union of two persons of the same sex, other than a marriage, that was
			 validly formed in another jurisdiction, and that is substantially equivalent to
			 a domestic partnership under
			 chapter
			 26.60 RCW.
(k) "Domestic partnership" means a
			 partnership registered under
			 chapter
			 26.60 RCW or a legal union
			 of two persons of the same sex, other than a marriage, that was validly formed
			 in another jurisdiction, and that is substantially equivalent to a domestic
			 partnership under
			 chapter
			 26.60 RCW.
(l) "Eligible resident" means a person who:
(i) Occupied the dwelling unit as their
			 principal place of residence as of December 31st of the assessment year the
			 home first became operational or in each subsequent year, occupied the dwelling
			 unit as their principal place of residence as of January 1st of the assessment
			 year. If an eligible resident is confined to a hospital or nursing home and the
			 dwelling unit is temporarily unoccupied or occupied by a spouse or domestic
			 partner, a person financially dependent on the claimant for support, or both,
			 the dwelling will still be considered occupied by the eligible
			 resident;
(ii) Is sixty-one years
			 of age or older on December 31st of the year in which the claim for exemption
			 is filed, or is, at the time of filing, retired from regular gainful employment
			 by reason of disability. A surviving spouse or domestic partner of a person who
			 was receiving an exemption at the time of the person's death will qualify for
			 this exemption if the surviving spouse or domestic partner is fifty-seven years
			 of age or older and otherwise meets the requirements of this subsection;
			 and
(iii) Has a combined disposable
			 income that is no more than the greater of twenty-two thousand dollars or
			 eighty percent of the median income adjusted for family size as determined by
			 the federal Department of Housing and Urban Development (HUD) for the county in
			 which the person resides and in effect as of January 1 of the year the
			 application for exemption is submitted.
(m) "First assessment year the home becomes
			 operational" or "the assessment year the home first became operational" means
			 the first year the home becomes occupied by and provides services to eligible
			 residents. Depending upon the facts, this year will be the year during which
			 construction of the home is completed or the year during which a nonprofit
			 organization purchases or acquires an existing home and begins to operate it as
			 a nonprofit home for the aging.
(n)
			 "Home for the aging" or "home" means a residential housing facility that:
(i) Provides a housing arrangement chosen
			 voluntarily by the resident, the resident's guardian or conservator, or another
			 responsible person;
(ii) Has only
			 residents who are at least sixty-one years of age or who have needs for care
			 generally compatible with persons who are at least sixty-one years of age;
			 and
(iii) Provides varying levels
			 of care and supervision, as agreed to at the time of admission or as determined
			 necessary at subsequent times of reappraisal.
(o) "HUD" means the federal Department of
			 Housing and Urban Development.
(p)
			 "Local median income" means the median income adjusted for family size as most
			 recently determined by HUD for the county in which the home is located and in
			 effect on January 1st of the year the application for exemption is
			 submitted.
(q) "Low income" means
			 that the combined disposable income of a resident is eighty percent or less of
			 the median income adjusted for family size as most recently determined by HUD
			 for the county in which the home is located and in effect as of January 1st of
			 the year the application for exemption is submitted.
(r) "Occupied dwelling unit" means a living
			 unit that is occupied either on January 1st of the year for which the
			 application for exemption is made or on December 31st of the assessment year
			 the home first becomes operational and for which application for exemption is
			 made.
(s) "Property that is
			 reasonably necessary" means all property that is:
(i) Operated and used by a home;
			 and
(ii) The use of which is
			 restricted to residents, guests, or employees of a home.
(t) "Refinancing" means the discharge of an
			 existing debt with funds obtained through the creation of new debt. For
			 purposes of this section, even if the application for tax exempt bond financing
			 to refinance existing debt is treated by the financing agent as something other
			 than refinancing, an application for a property tax exemption because of
			 refinancing by tax exempt bonds will be treated as refinancing and the
			 set-asides specific to refinancing will be applied. "Refinancing" shall include
			 tax exempt bond financing in excess of the amount of existing debt that is
			 obtained to modify, improve, restore, extend, or enlarge a facility currently
			 being operated as a home.
(u)
			 "Rehabilitation" means that an existing building or structure, not currently
			 used as a home, will be modified, improved, restored, extended, or enlarged so
			 that it can be used as a home for elderly and disabled individuals. A project
			 will be considered a rehabilitation if the costs of rehabilitation exceed five
			 thousand dollars. If a home has acquired tax exempt bond financing and does not
			 meet the definition of "rehabilitation" contained in this subsection, the home
			 may be eligible for a total exemption under the "refinancing" definition and if
			 it meets the "refinancing" set-aside requirements. If such a home is not
			 eligible for a total exemption, the department will determine the home's
			 eligibility for a partial exemption in accordance with the pertinent parts of
			 RCW
			 84.36.041 and this section.
(v) "Set-aside(s)" means the percentage of
			 dwelling units reserved for low-income residents when the construction,
			 rehabilitation, acquisition, or refinancing of a home is financed under a
			 financing program using tax exempt bonds.
(w) "Shared dwelling units" or "shared units"
			 means individual dwelling units of a home that do not contain complete
			 facilities for living, eating, cooking, and sanitation.
(x) "Taxable value" means the value of the
			 home upon which the tax rate is applied in order to determine the amount of
			 property taxes due.
(y) "Total
			 amount financed" means the total amount of financing required by the home to
			 fund construction, acquisition, rehabilitation, or refinancing. Seventy-five
			 percent of this amount must be supplied by tax exempt bonds to receive the
			 total exemption from property tax available under the tax exempt bond financing
			 provision of
			 RCW
			 84.36.041.