A special tax payer, in the context of bankruptcy, refers to a person or entity that holds legal or equitable title to real property. This property is subject to a special assessment or tax, which is specifically levied to fund improvements related to that property. The revenue generated from this tax is the only source for repaying obligations issued by the debtor to cover the costs of these improvements.
The term "special tax payer" is primarily used in bankruptcy law. It is relevant in cases where a debtor has incurred obligations to finance improvements on real property. This can involve various legal areas, including civil law and property law. Users can manage related forms and procedures through resources like US Legal Forms, which offers templates created by legal professionals.
Here are a couple of examples of abatement:
Example 1: A city levies a special tax on property owners to fund the construction of a new park. If a homeowner is a special tax payer, they are responsible for paying this tax, and the funds will be used exclusively to repay bonds issued for the park's development.
Example 2: A commercial property owner is assessed a special tax to finance infrastructure improvements in their area. As a special tax payer, they must pay this tax, which will help cover the costs of the improvements made to the surrounding infrastructure. (hypothetical example)
The primary legal reference for special tax payers can be found in the United States Bankruptcy Code, specifically under 11 USCS § 902. This section outlines the definition and implications of special tax assessments in bankruptcy proceedings.
Examples of state differences (not exhaustive):
| State | Special Tax Assessment Rules |
|---|---|
| California | Special assessments must be approved by a majority of property owners in the affected area. |
| Texas | Special taxes can be levied for specific improvements but must comply with local ordinances. |
| Florida | Property owners can challenge special assessments if they believe the tax is unfair or improperly calculated. |
This is not a complete list. State laws vary, and users should consult local rules for specific guidance.
If you find yourself classified as a special tax payer, it is important to understand your obligations regarding the special assessments. You should:
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