This COVID-19 emergency has resulted in an unprecedented downturn in the economy, a downturn that has lost Hoosiers their jobs and their incomes or has significantly reduced Hoosiers’ incomes. In an attempt to ameliorate the financial and economic damage to both property tax payers and to county governments, Governor Eric Holcomb issued Executive Order #20-05 on March 19, 2020. This executive order, which applies to all 92 Indiana counties, extends the date on which property taxes may be paid without penalty to July 10, 2020, while giving county governments access to various temporary funding streams to mitigate the resulting cash flow problems. The following day, Indiana’s Department of Local Government Finance issued guidance to assist county governments in complying with Governor Holcomb’s executive order. The Department’s letter addresses the executive order in more detail. Specifically, Sections 6(B), covers the delay of penalties for late property tax payments, and 13(C) reviews the mitigation of counties’ cash flow problems. How will these sections change your operations?
Section 6(B):
Obviously, taxpayers without incomes are unable to pay their taxes. Section 6(B) provides temporary relief to these Hoosiers. To that end, counties must not charge penalties for property taxes paid within 60 days after May 11, 2020. This delayed provision does not apply to parcels where the taxes are escrowed.
Property owners, therefore, have up to and including 07/10/2020 to pay their property taxes without penalties. This delay applies to property tax liabilities for both real and personal property. The deadline for filing personal property returns for the 2020-Pay-2021 cycle was not changed in the Governor’s EO 20-05, but he subsequently put forth EO 20-23(1), which extended the filing deadline to Monday, June 15, 2020.
Section 13(C):
Understanding that the remedies provided to taxpayers during this crisis will harm counties’ cash flows and their ability to operate their localities, Executive Order #20-05 provides four options, which county governments may use to meet their immediate financial needs. These are
- an Advanced Funding Program being offered by the Indiana Bond Bank;
- advances from the county treasurer for up to 95% of the amount to be received in the next settlement period;
- tax anticipation warrants or temporary loans; and
- temporary loans from private financial institutions.
While the restrictions put in place to battle COVID-19 continue, the State of Indiana is working hard to help both taxpayers and the counties to meet their responsibilities in concrete ways. To ensure the maximum effectiveness of Executive Order #20-05, both taxpayers and counties have a responsibility to maintain open channels of communications between themselves and with the State of Indiana. No one can help you, if no one knows you need the help. Pulling together, we will get through this and, again, enjoy happy and prosperous times.
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