HB1274
To Allow A Title Insurance Agent, Title Insurer, Or Title Company To Pay Real Property Taxes In Conjunction With The Issuance Of A Title.
AI-Generated Summary
This bill proposes amendments to existing Arkansas law concerning the collection of real property and personal property taxes. Specifically, it seeks to allow title insurance agents, title insurers, or title companies to pay real property taxes as part of the process of issuing title for a property. The bill amends Arkansas Code § 26-35-601(b) to create an exception to the general rule that county collectors must require payment of personal property taxes when accepting real estate taxes. This exception is further detailed in the amendment to § 26-35-601(c)(3). The amended section (c)(3)(A) states that a county collector shall accept real estate tax payments during a property ownership transfer if the transferring taxpayer has paid all delinquent personal property taxes. Additionally, the bill establishes a requirement for county collectors to respond to requests for tax statements within three business days. If a county collector fails to respond to such a request, the bill stipulates that they must accept real estate tax payments without requiring payment of related delinquent personal property taxes. The overall aim is to facilitate real estate transactions by providing clearer procedures and potential flexibility in tax payment collection.
Potential Impact Analysis
Who Might Benefit?
The primary beneficiaries of this bill would be individuals and entities involved in real estate transactions, particularly those facilitated by title insurance companies. Title insurance agents, title insurers, and title companies would benefit from the explicit allowance to pay real property taxes in conjunction with issuing title, which could streamline closing processes. Buyers and sellers of real property might also indirectly benefit from smoother and potentially faster real estate closings. County collectors would have a defined process for handling tax inquiries related to property transfers, and the stipulation for a response within three business days could improve operational efficiency.
Who Might Suffer?
The groups potentially negatively impacted by this bill are primarily those who owe delinquent personal property taxes and are attempting to transfer real property without settling those outstanding debts. If county collectors fail to respond to requests for tax statements within the stipulated timeframe, these individuals might be able to transfer real property without being compelled to pay their delinquent personal property taxes, potentially leading to a loss of tax revenue for the state or local governments. There is also a potential for increased administrative burden on county collectors if the volume of requests for tax statements is high and their response times are not met. Furthermore, if the intent of the original law was to ensure all taxes are collected during property transfers, then allowing real estate tax payment without requiring concurrent personal property tax payment could undermine that objective.