Court Opinion

ID: 3460872
Source: CourtListenerOpinion
Date Created: 2016-07-05 20:27:44.561776+00
Date Added: 2024-06-11T14:04:24.587011
License: Public Domain

Dear Mr. Edmiston:
Your request for an Attorney General's Opinion has been assigned to me for research and reply. You have asked for our opinion regarding the Special Assessment Level ("SAL") in Article VII, Section 18 of the Louisiana Constitution of 1974. Specifically, you ask the following questions: (1) whether a home that is titled in the name of a trust is eligible for the SAL; and (2) whether a person who has a usufruct on a home may qualify for the SAL.
Before addressing your question, we must advise that the determination of whether property is subject to homestead exemption and the SAL is a factual determination which is the responsibility of the various tax assessors, subject to review by the Louisiana Tax Commission and, ultimately, the courts. Article VII, Section 18 of the Louisiana Constitution of 1974 and La.R.S. 47:1952. In accord are Louisiana Attorney General Opinion Nos. 00-321 and 01-315.
The requirements for the SAL are set forth in La.Const. Art. VII, Sec. 18, which provides in part as follows:
  (G)(1) Special Assessment Level
  (a)(i) The assessment of residential property receiving the homestead exemption which is owned and occupied by any person or persons sixty-five years of age or older and who meet all of the other requirements of this Section shall not be increased above the total assessment of that property for the first year that the owner qualifies for and receives the special assessment level.
  (ii) Any person or persons shall be prohibited from receiving the special assessment as provided in this Section if such person's or persons' adjusted gross income, as reported in the federal tax return for the year prior to the application for the special assessment, exceeds fifty thousand dollars. For persons applying *Page 2 
for the special assessment whose filing status is married filing separately, the adjusted gross income for purposes of this Section shall be determined by combining the adjusted gross income on both federal tax returns. Beginning for the tax year 2001, and for each tax year thereafter, the fifty thousand dollar limit shall be adjusted annually by the Consumer Price Index as reported by the United States Government.
As can be gleaned from the statute above, to qualify for the SAL the following conditions must be met:
(1) The residential property in question must be receiving the homestead exemption.
(2) The residential property must be owned and occupied by a person or persons 65 years of age or older.
(3) The person or persons' adjusted gross income, as reported in their prior year federal tax return, must not exceed $62,180 for tax year 2008 (2009 Orleans Parish). Atty. Gen. Op. No. 05-0132.
In order to receive the SAL, whether based upon age or disability, the property must be owned and occupied by an eligible person or persons. If the property is owned by a trust, then it is not owned and occupied by eligible persons. In accord is Louisiana Attorney General Opinion No. 07-0273. Therefore, the answer to your first question is `no,' a home that is titled in the name of a trust is not eligible for the SAL.
As for your second question (whether a person who has a usufruct on a home may qualify for the SAL), the answer depends upon the facts and circumstances of the particular case. Louisiana Tax Commission Rules Regulations, § 101 (G)(7) provides,
  A usufructuary is entitled to the benefit of the SAL attained by the prior owner/occupant, provided that either,
    (a) The usufructuary is the owner's surviving spouse, occupying the house, who is fifty-five years of age of older or who has minor children, and the value of the property does not increase more than twenty-five percent because of construction or reconstruction, or
    (b) The usufructuary is the immediate prior owner of the homestead and the homestead is occupied by such usufructuary. A usufructuary is entitled to the special assessment level freeze if and when he or she qualifies independently.
Under these two circumstances, a usufructuary may qualify for the SAL. *Page 3 
Accordingly, it is the opinion of this office that a home titled in the name of a trust may not qualify for the SAL but that a person with a usufruct on a home may qualify for the SAL under the circumstances set forth in § 101(G)(7) of the Louisiana Tax Commission's Rules 
Regulations.1
We trust this adequately responds to your request. However, if our office can be of further assistance, please do not hesitate to contact us.
  Yours very truly,
  JAMES D. "BUDDY" CALDWELL
  Attorney General
  By: ____________________
  Lindsey K. Hunter
  Assistant Attorney General
  JDC/LKH/crt
1 We note that unlike the special assessment level, the homestead exemption has been extended, in certain instances, to include usufructs, trusts, and property owned in indivision. La.Const. Art. VII, Sec. 20.