By Stephen Smoot
In March of 2023, Governor Jim Justice signed into law a historic tax cut bill. It took months of divisive debate and negotiation, but a number of beneficial provisions came with it. Many taxpayers, however, remain confused about how to receive certain tax credits associated with the bill.
Part of that confusion came from the counties’ understandable concerns about financially being made whole from the credit. Originally, the State Legislature planned to eliminate the tax and give counties funding to compensate yearly. Counties expressed the concern that in hard times, the state might not be able to make the payment and counties would lack crucial funding.
The Legislature compromised on the issue by requiring that taxpayers pay counties on time, then submit a form to receive a credit for the tax directly from the state. This provides the solution that makes the most sense, but adds some complexity for taxpayers.
Three tax credits emerged from that bill.
The first, and most widely applicable, is the Motor Vehicle Property Tax Adjustment Credit. To receive this credit on vehicles, both businesses and individuals must pay on time. Businesses must pay the first half of their taxes by Sept. 1 and individuals by Oct. 1.
The Oct. 1 deadline has confused a number of taxpayers. Other deadlines apply as well. To collect the full credit on taxes filed for 2024, the entire tax bill must be paid by the final day of the year, Dec. 31. If the second half of owed taxes is paid between Jan. 1, 2025, and the final payment date of April 1, 2025, then the credit must be applied on taxes filed for 2025.
Class C, J, M, and R vehicles do not qualify for the credit.
The Disabled Veteran Real Property Tax Credit applies to, as the West Virginia Tax Division website states “eligible veterans who are owners of a homestead which is used or occupied exclusively for residential purposes.” This applies to veterans with a disability rate of 90 to 100 percent.
To qualify, the veterans’ disability has to come from the Veterans Administration. A doctor’s opinion or SSI qualification do not count.
This tax applies to real estate taxes owed by qualified veterans. Just as with the vehicle tax credit, they still must pay the taxes to the county by Oct 1. and by April 1 to qualify.
The Small Business Property Tax Adjustment Credit applies to ad valorem taxes paid by businesses worth $1 million or less.
According to the state, this covers 50 percent of “the true and actual value of all personal property owned by the small business in West Virginia, including the true and actual value of all personal property of related entities. This aggregate should include all automobiles. Automobile payments for which a Motor Vehicle Property Tax Credit was received will be factored out when determining the total amount of the Small Business Property Tax Credit that will be received if the small business is eligible.”
Any tax that falls into delinquency at any time will not qualify for a tax credit.
