Tax 14.05(8) (8) Exempt housing.

Tax 14.05(8)(a) (a) Under s. 71.53 (2) (e), Stats., no claim for homestead credit may be allowed if a claimant resided for the entire calendar year to which the claim relates in housing which was exempt from taxation under ch. 70, Stats., other than housing for which payments in lieu of taxes are made under s. 66.1201 (22), Stats., except as provided under s. 71.54 (2) (c) 2., Stats. Under s. 71.54 (2) (c) 2., Stats., if a claimant moves to tax-exempt housing, a claim for homestead credit may be allowed based upon property taxes accrued on the claimant’s former homestead under certain conditions. Those conditions are explained in s. Tax 14.04 (3) (e).

Tax 14.05(8)(b) (b) Under ss. 71.53 (2) (e) and 71.54 (2) (c) 1., Stats., if a claimant resided for part of the calendar year to which a claim for homestead credit relates, in a homestead which was either subject to taxation under ch. 70, Stats., or exempt from taxation under ch. 70, Stats., but for which payments in lieu of taxes were made under s. 66.1201 (22), Stats., the property taxes accrued or rent constituting property taxes accrued or both for that homestead are allowed for that portion of the year.

Tax 14.05(8)(c) (c) Payments in lieu of taxes made under s. 66.1201 (22), Stats., as provided in pars. (a) and (b), are made by most facilities licensed with the state of Wisconsin as “housing authorities.” Rent paid to those housing authorities may be used to determine gross rent and rent constituting property taxes accrued. However, other types of exempted housing which make payments in lieu of taxes do not make the payments under s. 66.1201 (22), Stats., and therefore rent paid to those types of exempted housing may not be used to determine gross rent and rent constituting property taxes accrued.

Tax 14.05(8)(d) (d) Types of tax-exempt housing other than housing authorities include:

Tax 14.05(8)(d)1. 1. Federal low-income housing under the housing and urban development, or “H.U.D.” program.

Tax 14.05(8)(d)2. 2. Student dormitories owned by nonprofit educational institutions.

Tax 14.05(8)(d)3. 3. Housing units of religious organizations.

Tax 14.05(8)(d)4. 4. Charitable, nonprofit nursing homes.

Tax 14.05(9) (9) Joint occupants of rental units.

Tax 14.05(9)(a) (a) Persons sharing living expenses for a rented homestead who are otherwise eligible for the homestead credit and who are not members of the same household, shall each be entitled to claim a portion of the rent paid for occupancy of the homestead. However, the total claims of the joint occupants for rent paid for occupancy may not exceed 100% of the rent paid to the landlord for occupancy, as shown on the rent certificate. The amount of rent paid for occupancy shall be the ratio which the contribution of the claimant or claimant’s household to the cost of shared living expenses, such as rent, food, utilities and supplies, bears to the total cost of the shared living expenses.

Tax 14.05 Note Example: X, Y, and Z are 3 unrelated joint occupants of a rental unit who share expenses as follows:

- See PDF for table

Since X paid 60% of the shared living expenses, X’s share of rent paid for occupancy is 60% of $5,400, or $3,240. Likewise, rent paid for occupancy for Y is 25% of $5,400, or $1,350, and for Z it is 15% of $5,400, or $810. Total rent paid for occupancy for all 3 claimants is $5,400, as shown on the rent for occupancy line.

Tax 14.05(9)(b) (b) If a claimant described in par. (a) is entitled to more or less rent paid for occupancy than is shown on the rent certificate completed by the landlord for the claimant, the claimant shall in addition to the certificate attach a statement to the homestead credit claim showing the computation of claimed rent paid for occupancy and identifying the other occupants of the homestead with whom rent and living expenses were shared during the year to which the claim relates by giving the name, current address at the time of filing the claim, if known, and social security number, if known.

Tax 14.05(10) (10) Rent paid for land. Under s. 71.52 (2), Stats., the portion of s. 71.52 (7), Stats., pertaining to property taxes accrued on land as described in s. Tax 14.04 (10) also applies to gross rent paid for land.

Tax 14.05(11) (11) Multipurpose and multidwelling buildings. Under s. 71.52 (2), Stats., the portion of s. 71.52 (7), Stats., pertaining to property taxes accrued on multipurpose and multidwelling buildings as described in s. Tax 14.04 (11) also applies to gross rent paid for a multipurpose or multidwelling building of which the homestead is a part.

Tax 14.05(12) (12) Sharecroppers. “Rent constituting property taxes accrued” of a person sharing the costs or proceeds or both from the operations of a farm with the owner of the farm property in consideration for use of the homestead, land, machinery or equipment equals 25% of the owner’s share of the net proceeds applicable to occupancy of the homestead, or 20% if heat is included in the cost of the rent.

Tax 14.05 Note Example: A sharecropper resides on and operates a 120 acre dairy farm. The landlord and the sharecropper share equally the gross receipts from crop sales, $10,000, the gross milk receipts, $40,000, and the cost of seed and feed, $20,000. The landlord furnishes the land, buildings and machinery, for which annual allowable depreciation is $6,000. The landlord pays for the heat. In this situation, rent constituting property taxes accrued for the sharecropper equals 20% of the owner’s share of the proceeds less the value of the nonoccupancy items furnished by the landlord, as follows:

- See PDF for table

Tax 14.05(13) (13) Low-income housing.

Tax 14.05(13)(a) (a) Indirect payments of rent, such as a subsidy payment from a governmental agency for low-income housing, are not includable in determining gross rent.

Tax 14.05(13)(b) (b) A landlord may receive both payments from a claimant and subsidy payments from a governmental agency for rental of the claimant’s homestead. If the allocation of the subsidy payments to food, medical services or other personal services as described in s. 71.52 (2), Stats., furnished by the landlord is not specified under the terms of an agreement with the governmental agency, the portion of the rent paid for occupancy eligible for the homestead credit shall be the total rent paid for occupancy multiplied by a fraction, the numerator of which is the amount paid by the claimant and the denominator of which is the total amount paid including governmental subsidies.

Tax 14.05 Note Example: A total of $5,400 is paid to a claimant’s landlord for the year on behalf of the claimant, $1,800 by the claimant and $3,600 by a governmental agency. The value of food provided in $600 and no services are provided.

Tax 14.05 Note Qualifying rent paid for occupancy is $1,600, computed as follows: $4,800´[$1,800¸$5,400]. The $4,800 is the total amount paid, $5,400, less the $600 for food. The $1,800 is the amount the claimant paid and the $5,400 is the total amount paid.

Tax 14.05(13)(c) (c) If an agreement with the agency paying the subsidy specifies how the subsidy is to be applied, the agreement shall be controlling in the determination of the claimant’s rent paid for occupancy.

Tax 14.05(14) (14) Nursing homes and long-term care facilities.

Tax 14.05(14)(a) (a) Any one of the following methods may be used by residents of nursing homes or long-term care facilities to determine rent paid for occupancy:

Tax 14.05(14)(a)1. 1. A standard rate of $100 per week but not more than the actual rent paid.