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Rules on Connecticut Property Tax Deferrals Fall to Towns

  • Governor Ned Lamont extends option for a three-month deferral on property taxes, though municipalities are left to decide how to administer it
  • Towns and cities can opt for an interest-free deferral or to charge 0.25 percent monthly on delinquent taxes
  • Deferral is automatic in some towns, while others must submit an application showing hardship

Connecticut residents and business owners are eligible for a three-month deferral on property taxes, though rules for these deferrals will differ from community to community.

Governor Ned Lamont signed an executive order in the spring ordering towns to defer taxes due in July by three months at zero interest or charge 3 percent per annum, or 0.25 percent a month, on delinquent taxes. He recently extended it to apply to taxes due Jan. 1 as well.

Legislative bodies or boards of selectmen in each municipality in the state must decide whether they will participate in the deferral program, low interest program, or both. They are also responsible for determining if individuals need to apply for a deferral or if it will take place automatically.

The vast majority of Connecticut municipalities are offering an interest-free deferral, according to a list by the Office of Policy Management. Just 59 have signed on to the low interest program.

Business owners applying for a deferral must demonstrate an expected revenue loss of 30 percent during the deferment period due to the COVID-19 pandemic, while residents must show an income loss of at least 20 percent due to the pandemic. Landlords applying for a deferment must show that they have suffered or are expected to suffer significant revenue loss, or that they offered commensurate forbearance to their tenants or lessees; the latter action is required to be eligible for the low interest program.

The new executive order only applies to taxes due Jan. 1, and doesn’t affect the interest rates on older delinquencies.

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