Double-, triple-dipping on the homestead credit
The homestead credit is a no-second-helpings deal in Maryland: You can get the tax break on only one home, your principal residence. That's true for married couples, too -- just one credit.
Julie Scharper and I reported that Mayor Stephanie Rawlings-Blake and her husband collected homestead tax credits on two separate properties before she stepped up to the city's top job. Kent Blake, her husband, repaid seven years' worth of credits between January and May 2010 on a Columbia house he owns. A spokesman for the mayor said the repayments were made "without any prompting."
Clerk of Circuit Court Frank M. Conaway Sr., one of Rawlings-Blake's challengers in the mayoral primary, has been collecting homestead credits on two properties while his wife benefits from a third.
He said he didn't realize that he had been receiving the tax break on a rental property in addition to the one for his home, adding that he would pay that money back. But he declined to comment when he was asked why his wife -- the city's register of wills -- also is receiving a credit on a city property she owns.
Blogger Adam Meister has written about the Conaways' homestead credits, a fact that escaped me until after I did a deep dive into all the major mayoral candidates' property records and found problems. (I'm the opposite of a political junkie, so I hardly ever read politics blogs. Hey, I can't be a wonk in everything.)
What's probably best known about Meister's blogging: his posts about Frank Conaway's daughter, Belinda Conaway. The city councilwoman filed and then dropped a libel suit against Meister for writing that she had indicated in a document filed in the land records that a Baltimore County property she owns is her principal residence. That home also received a homestead credit. (Belinda Conaway's attorney said the document had been signed in error.)
Homestead credit double-dipping has cropped up a lot over the years, sometimes by property owners who -- for reasons explained in today's story -- don't realize they're doing it. Triple-dips, even quadruple-dips, happen, too.
A 2007 law designed to put an end to unwarranted homestead breaks specified for the first time that owners must apply for the credit, a requirement that is being phased in. New buyers must submit their information, including a Social Security number, to state assessors. Owners who bought before 2008 have until the end of next year to follow suit.
If a Social Security number is associated with more than one property for purposes of the homestead credit, that's a red flag to assessors to follow up with the owner. And because the IRS links spouses' Social Security numbers, staffers will know if there's any husband-and-wife double dipping on credits, according to Robert E. Young, director of the state Department of Assessments and Taxation.
Those checks and balances won't be fully functional until the application deadline for longer-term owners has passed, of course. That's 16 months away.