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Scott County signs onto homestead-deduction audit program; vendor to receive 40% of recoveries
Summary
Commissioners approved Tax Management Associates to audit homestead exemptions for ineligible duplicates; the vendor’s fee is 40% of any back taxes, fees and penalties collected and the county will create a fund to hold recovered amounts.
The Scott County Board of Commissioners voted June 3 to participate in the Tax Management Associates homestead-deduction audit program. County staff explained the vendor will audit homestead exemptions to identify duplicates or ineligible claims (for example, owners with an additional homestead in another state) and that state law allows collecting back taxes up to three years. If recoveries are obtained, the vendor’s contract provides for a 40% fee on amounts collected (including back taxes, fees and penalties).
Staff said the county will need an ordinance to create a fund to receive collected amounts for the auditor’s office; if the county finds an ineligible homestead and the county promptly acts on it, the county does not pay a separate penalty to the vendor. Commissioners approved entering the program by voice vote.
Why it matters: The program can identify improper homestead deductions and return revenue to the county, but it uses a contingency fee model and requires administrative follow-up and a new fund to receive amounts recovered.
What’s next: Staff will draft the necessary fund-creation ordinance and bring contract details back to commissioners and council as required.
