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House Bill 212 — Income, property tax reduction

House Bill 212 — Income, property tax reduction

Parrish Miller
February 24, 2021

Bill Description: House Bill 212 creates a carve-out for owners of a 'certified family home' by exempting Medicaid payments from being considered income when calculating their eligibility for the 'circuit breaker' property tax reduction. 

Rating: -1

Does it increase government redistribution of wealth? Examples include the use of tax policy or other incentives to reward specific interest groups, businesses, politicians, or government employees with special favors or perks; transfer payments; and hiring additional government employees. Conversely, does it decrease government redistribution of wealth?

Idaho code contains a carve-out in property tax law that reduces taxes for certain classes of individuals. These include: lower-income individuals who are age 65 or older; widows and widowers; people who are blind; orphans under 18; former prisoners of war; disabled veterans, and people considered by the Social Security Administration or another approved source to be disabled. 

Individuals who fall into one or more of these categories and had an income of $31,900 or less for 2020, may qualify for a property tax reduction of up to $1,320. This happens under the circuit breaker program.

House Bill 212 amends Section 63-701, Idaho Code, to create a special perk for owners of a "certified family home," defined as "a family-styled living environment in which two (2) or fewer adults live who are not able to reside in their own home and who require care, help in daily living, protection and security, supervision, personal assistance and encouragement toward independence."

Some of those individuals earn income by serving as an enrolled Medicaid provider, by, for example, serving as a home health aide. For those individuals who are in one or more of the circuit breaker categories and own and reside in a "certified family home," House Bill 212 will allow them to exclude from their income any payments they receive from the medical assistance program for being an enrolled Medicaid provider. In other words, they can make up to $31,900, plus any payments from Medicaid, and still qualify for the circuit breaker property tax reduction. 

Property tax carve-outs for certain property owners are not generally funded through reductions in government spending. Instead, other taxpayers are forced to pay more to make up the difference, with the circuit breaker funded specifically with sales tax money that would otherwise go to the General Fund. 


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