Property tax relief is commonly sought through targeted policies intended to reduce the tax burden for individual taxpayers, such as exemptions for fixed- or lower-income individuals. Other policies aim to provide more broad-based property tax relief by limiting the growth of the components used to determine the amount of tax paid. Approaches to tax relief that fall under the latter are the subject of this article.

Ad Valorem Taxation of Real Property in Kansas

In Kansas, real property—which includes real estate and associated property rights—is subject to ad valorem (according to value) property tax as a source of revenue for county and local governments. The tax to be assessed in a given year is determined by multiplying together the values of three components, as follows:

• The value of the property as determined by each county appraiser each year according to constitutional and statutory requirements;
• An assessment ratio, as defined by the Kansas Constitution, according to use classification; and
• A mill levy rate (or millage rate) determined by dividing the total amount of revenue to be levied by the total value of property to be taxed within the jurisdiction.

Approaches to Property Tax Limits

Policy approaches that attempt to broadly limit property tax growth include levy limits, rate limits, and assessment limits:

• Levy limits (or revenue limits) limit the amount that total property tax collections made by a taxing jurisdiction may increase from one year to the next;
• Rate limits restrict growth of millage rates that taxing jurisdictions can set and may be applied by setting an absolute maximum rate or by limiting the relative amount that rates may grow from one year to the next; and
• Assessment limits restrict the amount that a property’s valuation may increase from one year to the next.

Rate and levy limits often have exemptions that enable the limits to be exceeded under certain conditions, such as when authorized by voter approval or when certain conditions of the purpose for revenue increases are met.

Among states that utilize assessment limits, a common exception is that the limitation does not apply in years where certain events transpire, such as improvement or sale of the property, among others.

Approaches to Property Tax Limits in Kansas

Kansas does not currently impose direct limitations on levies, mill rates, or valuation increases; however, Kansas has had both levy limits and rate limits throughout much of its history.

From 1908 until 1933, statute provided that individual taxing entities could not increase amounts levied in any year by more than 2 percent, with a similar limitation placed on the aggregate amount levied by local governments beginning in 1933. In 1970, the Legislature enacted temporary limits on growth of operating budgets for all taxing entities (a form of levy limit), while making reforms to the earlier levy limits that persisted in largely the same form until the repeal of the so-called “tax lid” in 1999. For most of that period, tax levies could be increased beyond limits (up to a maximum rate increase) if approved by voters.

Legislation referred to as “truth in taxation” was adopted in 1999 that imposed a general limit on any levy increase from one year to the next without the adoption of a resolution or ordinance, unless the increase was attributable to new improvements to real property, increased personal property valuation, newly applicable taxing jurisdictions, or changes in the use of property.

A new form of the tax lid, adopted in 2015 and repealed in 2021 by the adoption of SB 13, generally limited increases in levy amounts to the rate of inflation unless approved by voters. Since that time, Kansas has applied a requirement that mill rates beyond what would generate the same amount of revenue as in the previous year (the “Revenue Neutral Rate”) require special notice and a public hearing afforded to taxpayers.

Recent Legislative Proposals

More recently, the Legislature has considered policies that would have imposed limits on valuation growth. 2023 SCR 1611 would have amended the Kansas Constitution to limit the annual growth of the valuation of a parcel of real property to 4 percent, except in years when certain events occur, including when new construction or improvements have been made to the property or when the title to the property is transferred, changed, or conveyed to another person. Similar approaches have been proposed in additional legislation, including 2024 SCR 1621 and the 2024 Special Session resolutions SCR 1603 and SCR 1604.

During the 2023 Interim, the 2023 Special Committee on Taxation considered property valuation issues, including those related to the subject matter of 2023 SCR 1611 and additional items. Among the recommendations made by the Committee was that the Legislature consider implementation of tax levy limitations or a possible hybrid of SCR 1611 and the limitation approach utilized in Florida, which imposes similar limitations but includes a component allowing taxpayers to retain a portion of their growth limitation benefit, even when changing residences.

Disabled veterans are currently entitled to residential property tax relief measures in all 50 states; however, the qualifications and scope of relief vary greatly from state to state. Note: All provisions discussed in this article refer to the primary residence of a disabled veteran.

Veterans Administration Disability Ratings

Typically, state or local laws require a person to be designated by the U.S. Department of Veterans Affairs (VA) as having some sort of compensable service-connected disability. In other words, the disability must be connected to the person’s service in a branch of the U.S. military and must also meet the threshold for disability compensation. For veterans under the care of the VA, their service-connected disability or disabilities are assigned a rating, with 10 percent being the lowest rating. Disability ratings may then be combined up to a maximum total of 100 percent. For additional information on disability ratings and compensation, please visit the VA’s website.

State Qualifications—Disability Rating-only

In the majority of states, disabled veterans may receive a residential property tax benefit regardless of income or property valuation.

100 Percent Disability-only

A total of 27 states offer either a complete or partial exemption of residential property taxes for primary residences of veterans with a 100 percent disability rating-only.

Less than 100 Percent Disability

In 11 states, persons with less than a 100 percent disability rating may receive an exemption of a portion of the taxable value of their primary residence, resulting in a lower amount of residential property taxes due. In many of these states, the exemption is proportional to disability rating. The exemption threshold also varies greatly, with some states providing some benefit at 10 percent disability and others having minimum thresholds between 40 to 90 percent.

Other Qualifications and Specific Benefits

Delaware offers full exemption from school district residential property taxes for 100 percent disabled veterans. In Hawaii, county laws and ordinances govern residential property tax, with some counties granting a 100 percent exemption to certain disabled veterans, with a minimum tax due of $150 in each county. Idaho law provides a $1,500 credit toward residential property taxes for persons with a 100 percent disability rating. Missouri provides a 100 percent exemption for veterans who have a 100 percent disability rating and who were also a prisoner of war.

State Qualifications—Income or Valuation Threshold

In eight states, residential property tax benefits for disabled veterans are only extended to those who meet certain income thresholds or whose primary residence is valued under a certain amount for taxing purposes.

Current Kansas Benefits

The state Senior or Disabled Veteran program, enacted in 2022, is available to Kansas residents who, for the entire year:

• Owned and occupied a home in Kansas;
• Were 65 years or older or a disabled veteran with a 50 percent or greater permanent disability rating; and
• Had a household income at or below the threshold for eligibility, which was $53,600 in 2023.

If the home’s value did not exceed $350,000 in their base year, the taxpayer can receive a refund in the amount of the difference between the current year and base year tax amount, with the base year being the first year the taxpayer was eligible for the program.

Veterans’ Valor Property Tax Relief Act—2024 HB 2096

HB 2096 (2024) would have enacted the Veterans’ Valor Property Tax Relief Act, which would have created a refundable income tax credit for veterans with a 100 percent permanent disability or unemployable rating by the VA. The credit would have refunded 75 percent of the property and ad valorem taxes paid on the residential property of such veteran. Taxpayers receiving the credit would have been prohibited from receiving certain other property tax relief credits and would not have been subject to income or valuation requirements. HB 2096 included other tax provisions and was vetoed by the Governor. The Legislature did not make a motion to override the veto.

Kansas has had some form of property tax relief program for certain residential property since 1970, when the Homestead Property Tax Relief Act was enacted. Today, Kansas has three such programs, each differing in their recipients and benefits.

This article summarizes the key elements of Kansas’ Homestead Property Tax Refund Act, Selective Assistance for Effective Senior Relief (SAFESR) program, and a newer “tax freeze” benefit option.

Homestead Property Tax Refund Act

Kansas became the sixth state to adopt a property tax “circuit breaker” program in 1970 with the enactment of the Homestead Property Tax Refund Act.

This program provides a refund of a portion of property taxes paid, up to $700. The refund amount is determined using a sliding scale where participants with higher incomes receive a smaller percent and participants with lower incomes receive a greater percent.

Taxpayers with incomes below $6,000 are entitled to 100 percent of their property tax or the cap of $700, whichever is lower. For each $1,000 increase in the income amount, the benefit amount decreases by 4 percentage points to $16,000 and 60 percent, at which point the sliding scale adjusts to 5 percentage points for each $1,000 of income until leveling off at 5 percent for all eligible incomes over $26,000.

This program requires participants to have household incomes of $40,500 or less as of 2023 (the actual amount is annually indexed for inflation) and to meet at least one additional eligibility criteria for someone in the household:

• Age 55 or above;
• A dependent under the age of 18; or
• Blind or otherwise disabled.

Selective Assistance for Effective Senior Relief

In 2008, Kansas enacted a simplified version of a circuit breaker program with a generally larger benefit and heightened eligibility thresholds.

This option required someone in the household to be age 65 or above and the household income to be equal to or less than 120 percent of the federal poverty level for a family of two people, which equaled $23,700 for 2023.

The benefit paid under this program is 75 percent of the total property tax paid, without the $700 limit applicable to the Homestead program, resulting in larger average refunds than the Homestead program but fewer eligible claimants.

“Tax Freeze” Option

In 2022, Kansas enacted a new approach to determining the amount of property tax relief afforded to eligible beneficiaries.

This option, which attempts to “freeze” taxpayers’ bills at the amount for the year in which they first became eligible for the program, grants a benefit that is the difference between the current year’s tax and the tax amount for the base year. Accordingly, the size of the benefit is typically linked to the length of time the taxpayer has been eligible for the program.

The base year is 2021 or the first year the taxpayer meets the eligibility criteria for the program, whichever is later.

The program requires participants to have household incomes of $53,600 or less, as of 2023 (actual amount indexed for inflation), and to be either age 65 or above or a disabled veteran with a permanent disability rating of at least 50 percent.

Provisions Applicable to Multiple Programs

Each program contains a provision prohibiting beneficiaries under the program from being eligible for either of the other two programs, meaning a taxpayer may only receive benefits under one program per year. However, taxpayers are able to participate in different programs in different years.

For all programs, household income is defined more broadly than taxable income is defined for individual income tax purposes, specifically including 50 percent of Social Security benefits, regardless of whether they are subject to tax and other income categories.

All programs generally require the claimant to be a resident of Kansas for the entire year and to own their home.

Each program has a residential valuation limitation of $350,000. However, this limitation only applies to the base year for the tax freeze option.

All programs provide an option for the refund amount to be automatically applied to the taxpayer’s property tax bill for the following year, thereby directly lessening the amount of property tax required to be paid in all years other than the first year of participation in the program.