State Tax Commission of Missouri
DONALD DIAMOND,)
)
Complainant,)
)
v.) Appeal Number 10-33001
)
RICK KESSINGER, ASSESSOR,)
GREENE COUNTY, MISSOURI,)
)
Respondent.)
DECISION AND ORDER
HOLDING
Motion for Judgment on the Pleadings granted.Decision of the Assessor to assess the Complainant’s motor vehicle is AFFIRMED.The assessed value for the subject motor vehicle is set at $4,840.Complainant appeared pro se.Respondent appeared by County Counselor Theodore L. Johnson, III.
Case decided by Senior Hearing Officer W. B. Tichenor.
ISSUE
Complainant appeals, on the ground of discrimination and exemption, the assessment of his motor vehicle by the Greene County Assessor.The Commission takes this appeal to determine whether the subject motor vehicle is exempt from taxation.The Hearing Officer, having considered all of the competent evidence upon the whole record, enters the following Decision and Order.
FINDINGS OF FACT
1.Jurisdiction.Jurisdiction over this appeal is proper.Complainant timely appealed to the State Tax Commission from the Assessor’s Assessment.[1]Evidentiary hearing was waived[2] and the case is decided upon the pleadings.
2.Assessment.The Assessor assessed the subject motor vehicle at $4,840.[3]
3.Subject Property.The subject property is a 2008 Ford E-350 Super Duty Econoline Wheelchair Van.It is identified by VIN: 1FBNE31L98DA80196.[4]
4.Procedural History.
A.Complaint for Review of Assessment filed (11/29/10).[5]
B.Commission Acknowledgement sent (12/7/10).
C.Order Setting Exhibit Exchange issued (1/13/11).
D.Respondent’s Motion for Judgment on the Pleadings filed (2/4/11).
E.Order Granting Motion to Stay and Setting Response Date issued (2/4/11).
F.Response to Order of 2/4/11 filed by Complainant (2/25/11).
5.Complainant’s Grounds for Appeal.Complainant listed the following grounds in his Complainant for Review of Assessment for his appeal from the assessment.
A.Discrimination – VA benefits are not taxed by federal or state governments.
B.Exemption – A prosthetic device.
C.Other – Provided by VA –Title 38, wheelchair van for 100% service disability, loss of use of both feet – Prosthetics Dept., Washington, D.C. VA Hospital.
6.Specific Findings of Fact.Based on Exhibits A, B, C, and D, the following facts may be concluded:
A.Complainant applied with the Department of Veterans Affairs for a Van on 2/17/09.Complainant was certified eligible under 38 U.S.C. 3901-3904 to purchase the requested van on 2/24/09.[6]
B.Complainant purchased the subject motor vehicle and executed his Promissory Note on its purchase on 3/6/09.[7]
C.By Decision issued April 7, 2009, The Department of Veterans Affairs issued the following Decision on Complainant’s Claim:
Entitlement to special monthly compensation based on having one serviceconnected disability independently rated at 100 percent disabling and having oneor more other service connected disabilities rated at 50 percent or more combinedcriteria being met is granted from March 1, 2006.
CONCLUSIONS OF LAW AND DECISION
Jurisdiction
The Commission has jurisdiction to hear this appeal and correct any assessment which is shown to be unlawful, unfair, arbitrary or capricious.The hearing officer shall issue a decision and order affirming, modifying or reversing the determination of the board of equalization, and correcting any assessment which is unlawful, unfair, improper, arbitrary, or capricious.[8]
Motion for Judgment on the Pleadings Granted
Complainant’s Discrimination Claim
Counsel for Respondent argues in his Motion for Judgment on the Pleadings that Complainant is not entitled to the relief sought under a discrimination claim.Counsel correctly asserts, “To make a successful claim under discrimination, the Complainant must establish that his property has been assessed at a greater percentage of value than other property, generally,
within the same class within the taxing jurisdiction for the assessment cycle.”[9]Complainant is not claiming a non-uniform assessment, but rather that his vehicle is exempt from taxation.
In Complainant’s letter of Response, no denial of the Respondent’s argument was presented.No claim was made that it was the policy of the Assessor’s Office to exempt other wheelchair vans owned by individuals, veterans or non-veterans.Nothing presented either by way of the documents filed with the Complaint or the Response to the Motion for Judgment would support a claim of inequality in assessment.Respondent’s point is well taken.
This is not a discrimination case.It is a claim for exemption and nothing more.As to the claim of discrimination, Motion for Judgment on the Pleadings is granted.Appeal is dismissed as to that ground.
Complainant’s Exemption Claim
Mr. Diamond’s claim for exemption covers both the Exemption and Other grounds marked on the Complaint.In an appeal seeking exemption from taxation, the Complainant must present substantial and persuasive evidence to establish that the property falls within an exempted class under the provisions of Section 137.100.[10]It is well established that taxation is the rule and exemption from taxation is the exception.Exemption is not favored in the law.[11]
Substantial evidence can be defined as such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.[12]Persuasive evidence is that evidence which has sufficient weight and probative value to convince the trier of fact.The persuasiveness of evidence does not depend on the quantity or amount thereof but on its effect in inducing belief.[13]
The substance of Complainant’s claim is that his wheelchair vehicle is a prosthetic device paid for in part by the Department of Veterans Affairs and therefore should be exempt.Complainant’s documents filed with the Complaint for Review of Assessment fail to establish the existence of any federal statute which preempts the State of Missouri from assessing the subject motor vehicle.Likewise in his Response to the Motion for Judgment, Mr. Diamond did not provide the Hearing Officer with evidence that would establish, as a matter of law, a wheelchair van owned by a veteran with 100% service connected disability is exempt from ad valorem taxation in Missouri.
Counsel for Respondent properly presented the case relative to veteran-related exemptions under the Missouri Constitution and statutes.There are two veteran-related exemptions provided for in Article X, Section 6.The first of the two exemptions the constitution provides is “all real property used as a homestead as defined by law of any citizen of this state who is a former prisoner of war, as defined by law, and who has a total service-connected disability. . . .”Complainant has a total service connected disability.He made no claim to be a former prisoner of war.Nor is Mr. Diamond seeking an exemption for “real property used as a homestead.”This exemption does not apply to the present case.
The second veteran-related exemption authorized by Article X, Section 6 is for “all property, real and personal, not held for private or corporate profit and used exclusively … for veterans’ organizations.”The legislature enacted this exemption in Section 137.100(9), RSMo.The term “veterans’ organization” is defined in the statute as “any organization of veterans with a congressional charter, that is incorporated in this state, and that is exempt from taxation under section 501(c)(19) of the Internal Revenue Code of 1986, as amended.”The subject motor vehicle is not owned by a veterans’ organization.It is owned by a private citizen, albeit a disabled veteran.No response has been presented by Mr. Diamond that the vehicle is used exclusively for a veterans’ organization.The subject vehicle is used for Mr. Diamond’s personal use.
It is well established that it is the policy of law in the state of Missouri that no property than that enumerated by constitution or statute may be exempted from taxation.[14]The above cited exemptions from taxation are the only ones for veterans or veterans’ benefits enumerated by constitutional or statutory provisions.
Furthermore, assuming for the sake of Mr. Diamond’s argument, that a van would be considered a prosthetic device[15] there is no exemption from property tax for prosthetic devices under Missouri law.Therefore, absent a federal law preempting Missouri’s ad valorem property assessment laws with respect to veterans’ benefits or prosthetic devices, Mr. Diamond cannot, as a matter of law, be given an exemption for his vehicle.Complainant did not in his Response cite the Hearing Officer to any U. S. Code provision which preempts Missouri from levying a property tax on the subject van.
Section 5301(a)(1) of Title 38 [Veterans Benefits]The United States Code, provides that “[p]ayments of benefits due or to become due under any law administered by the Secretary shall not be assignable except to the extent specifically authorized by law, and such payments made to, or on account of, a beneficiary shall be exempt from taxation, shall be exempt from the claim of creditors . . . .”[16]This is a federal tax exemption for veterans’ benefits.However, the statute further provides, “[t]he preceding sentence shall not apply to claims of the United States arising under such laws nor shall the exemption therein contained as to taxation extend to any property purchased in part or wholly out of such payments.”[17]Emphasis added.
It is clear that veterans’ benefits in the form of cash payments are exempt from income taxes.However, when converted to property (real or personal), such property loses its exempt status and is subject to state property taxes.In order to be exempt from taxation, the benefits
must be “readily available as needed for support and maintenance, actually retain the qualities of moneys, and [must not have been] converted into permanent investments.”[18]
Complainant obtained his 2008 Ford Econoline E350 by exercising his right under the following veteran’s benefit statute.
“The Secretary . . . shall provide or assist in providing an automobile or other conveyance to each eligible person by paying the total purchase price of the automobile or other conveyance (including all state, local, and other taxes) or $11,000, whichever is the lesser, to the seller from whom the eligible person is purchasing under a sales agreement between the seller and the eligible person.”[19]
The Veterans’ Administration provided Complainant an $11,000 payment for the purpose of purchasing his vehicle.This payment, while in monetary form, was not taxable income.Nor was it taxable in monetary form under the Missouri statutes for ad valorem taxation of personal property.However, when Complainant applied the payment to the purchase of his vehicle, the benefit lost its tax exempt status under 38 U.S.C. § 5301(a)(1) and the vehicle became taxable personal property under Missouri’s ad valorem property tax laws.Complainant provided no federal statutory or case law citation purporting to preempt state taxation of personal property that could be arguably be classified as a “prosthetic device” used by veterans.Respondent was unable to find any such federal law.The Hearing Officer likewise found no such statute or case.
Complainant’s vehicle is not tax exempt under Federal or Missouri law as either a “VA benefit” or “prosthetic device.”While Veterans’ Administration benefits are initially exempt from income taxes, when in monetary form and used for the support and maintenance of a veteran, they lose tax exempt status when converted into real or personal property.Missouri does not exempt from taxation personal property that is traceable to a benefit provided by the Veterans’ Administration, nor does it exempt from taxation property held by veterans generally.Finally, neither the federal government nor the state of Missouri has exempted prosthetic devices from ad valorem property taxes.For all the foregoing reasons, Complainant is not entitled to have his motor vehicle exempted from ad valorem property taxes.
Respondent’s Motion for Judgment on the Pleadings as to the claim for exemption is granted.
ORDER
The assessed valuation for the subject property as determined by the Assessor for Greene County for the subject tax day is AFFIRMED.
The assessed value for the subject property for tax year 2010 is set at $4,840.
Application for Review
Complainant may file with the Commission an application for review of this decision within thirty days of the mailing date set forth in the Certificate of Service.The application shall contain specific facts or law as grounds upon which it is claimed the decision is erroneous.Said application must be in writing addressed to the State Tax Commission of Missouri, P.O. Box 146, Jefferson City, MO65102-0146, and a copy of said application must be sent to each person at the address listed below in the certificate of service.
Failure to state specific facts or law upon which the application for review is based will result in summary denial. [20]
Disputed Taxes
The Collector of Greene County, as well as the collectors of all affected political subdivisions therein, shall continue to hold the disputed taxes pending the possible filing of an Application for Review, unless said taxes have been disbursed pursuant to a court order under the provisions of Section 139.031.8, RSMo.If no Application for Review is filed with the Commission within thirty days of the mailing date set forth in the Certificate of Service, the Collector, as well as the collectors of all affected political subdivisions therein, shall disburse the protested taxes presently in an escrow account in accord with the decision on the underlying assessment in this appeal.
Any Finding of Fact which is a Conclusion of Law or Decision shall be so deemed.Any Decision which is a Finding of Fact or Conclusion of Law shall be so deemed.
SO ORDERED April 7, 2011.
STATE TAX COMMISSION OFMISSOURI
_____________________________________
W. B. Tichenor
Senior Hearing Officer
Certificate of Service
I hereby certify that a copy of the foregoing has been mailed postage prepaid on this 7th day of April, 2011, to:Donald Diamond, 2021 E. Lark Street, Springfield, MO 65804, Complainant; Theodore Johnson, Greene County Counselor, 901 St. Louis Street, 20th Floor, Springfield, MO 65806, Attorney for Respondent; Rick Kessinger, Assessor; Richard Struckhoff, Clerk; Scott Payne, Collector, Greene County Courthouse, 940 Boonville, Springfield, MO 65806.
___________________________
Barbara Heller
Legal Coordinator
Contact Information for State Tax Commission:
Missouri State Tax Commission
301 W. High Street, Room 840
P.O. Box 146
Jefferson City, MO 65102-0146
573-751-2414
573-751-1341 Fax
[1] Complaint for Review of Assessment was filed on November 29, 2010.Appeal relating to a motor vehicle for which no notice of assessment has been sent by the Assessor, may be appealed by December 31st of the relevant tax year.12 CSR 30-3.010 (1)(B)2
[2] Order, dated 1/3/11 – “On or before March 7, 2011, each party is to inform the Hearing Officer in writing if they desire to have an evidentiary hearing in the case of if they are willing to have the appeal decided based upon the submission of exhibits as herein ordered in lieu of an evidentiary hearing.Any party who fails to respond as ordered will be deemed to have consented to a decision being rendered based upon the exhibits submitted by each party, and waived their right to an evidentiary hearing.”
[3] The Hearing Officer may inquire of either party as to any matter involved in the appeal.Section 138.430.1, RSMo.The Hearing Officer on 3/17/11, emailed Counsel for Respondent to obtain the assessed amount for Complainant’s motor vehicle.The Hearing Officer was informed the assessed value was $4,840.Email correspondence in Commission file for this appeal.
[5] There were four documents attached to the Complaint for Review of Assessment, which the Hearing Officer marked for purposes of identification as follows:
|
EXHIBIT |
DESCRIPTION |
|
A |
Dept. of VA – Complainant’s Application for Automobile – 2/24/09 |
|
B |
Decision Review Officer Decision – 4/7/09 |
|
C |
Buyers Order – Subject Motor Vehicle – 3/6/09 |
|
D |
Complainant’s Promissory Note for purchase of Subject – 3/6/09 |
[9] Cornerstone Industrial Fund v. Muehlheausler, STC Appeal No. 04-10166 (9/23/08 – citing Koplar v. STC, 321 S.W.2d 686, 690, 695 (Mo. 1959)
[11](See, Missouri Church of Scientology v. STC, 560 S.W.2d 837, 844 (Mo. banc 1977); CSCEA v. Nelson, 898 S.W.2d 547, 548 (Mo. banc 1995), citing Scientology); Abbot Ambulance, Inc. v. Leggett, 926 S.W.2d 92, 95 (Mo. App. E.D. 1996).
[15] A prosthesis is the “replacement of a missing part of the body, as a limb, eye, or tooth, by an artificial substitute.”Webster’s New World Dictionary, Second College Edition.The Hearing Officer certainly understands that the van serves as a means of transporting Mr. Diamond in his wheelchair, which he is required to use due to the loss of use of both feet.However, neither his wheelchair, nor his vanmeet the definition of a prosthesis.The van is not the replacement of a missing part of the body.