Feb 18, 2008 - 04:05:34 CST
Thousands of North Dakotans are baffled by the new tax credit offered on this year's state income tax returns, which requires taxpayers to dig out a year-old county statement and complete some extra paperwork.Questions about the credit have prompted more than 700 calls weekly to a toll-free Tax Department help line since the tax filing season began, Tax Commissioner Cory Fong said. He is expecting the number to rise as more North Dakotans set to work on their 2007 income tax returns.
"This is a new program, and it is not surprising that people have questions," he said. The Tax Department has a toll-free phone number (877-328-2760) and a specific e-mail address (propertytaxrelief@;nd.gov) to take inquiries.
The Legislature last year set aside $115 million to provide two years' worth of income tax credits, which will benefit North Dakota residents who own real estate, commercial property or a mobile home.
Single taxpayers may claim a credit of up to $500, while a married couple may see their income tax bill lowered by up to $1,000.
But first, North Dakotans who own a home, farm land or other real estate have to find their 2006 property tax statement - the one that's a year old, instead of the 2007 statement that arrived in the mail a few weeks ago.
An eligible taxpayer's 2007 income tax credit is 10 percent of his or her 2006 property tax. The 10 percent figure is subtracted from the income tax a person owes.
Most North Dakotans who qualify for the credit also must fill out a separate, one-page form, called the PT form, to calculate their credit.
North Dakotans who own property and qualify for the credit, but who do not make enough money to file an income tax return, use a separate document called the ND-3 form. They do not need to fill out any other forms to get their credit.
Among income tax filers so far, the Tax Department has observed these common problems, Fong says:
n Using the wrong property tax statement to calculate the income tax credit. The 2006 statement must be used to calculate the credit against 2007 income taxes.
n Using the wrong figure on the 2006 property tax statement to figure the credit. The "consolidated tax," which is the amount before any discount is applied, is used to calculate the final credit. Special assessment payments are not counted.
n Failing to list a number that designates the county where the taxpayer lives. Each of North Dakota's 53 counties has its own three-digit number. The numbers table is listed in the North Dakota income tax instruction booklet, and on the back of the ND-3 form.
n Unfamiliarity with the property tax statement's "property number" or "parcel number." The number is listed on the statement. Some income tax filers have listed their property's legal description instead of the property number, Fong says.
"It's a unique number. There are no two parcel numbers across the state that are identical. That is critical to our validation process," Fong said. "That is how we know someone is claiming what they are entitled to."
Tax Department processors may fix some glaring filing errors on their own, but other mistakes are delaying the processing of returns - and refund payments.
"We're trying to fix as many as we can where we can see the errors. They're obvious. We've got property tax data from the county, we can go in and fix some of the (filing mistakes)," Fong said. "But on some of them, we can't, so we're having to send those back."
RodM wrote on Feb 18, 2008 10:45 PM:
Use Your Head wrote on Feb 18, 2008 11:40 AM:
taxes wrote on Feb 18, 2008 9:19 AM:
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