Friday, May 10, 2013
Know the laws. If you are operating a business from your home make sure you are entitled to your homestead exemption. In some cases people were operating ALF's (Adult Living Facilities) and the owner was not living in the home and still claiming the Homestead exemption.
Story from the Miami Herald
by Carol Marbin Miller
Already the focus of intense scrutiny by lawmakers and elder advocates, Florida’s troubled assisted-living industry has taken another hit: Miami-Dade’s new property appraiser has accused scores of the homes’ owners of gaining improper homestead exemptions that could cost taxpayers millions of dollars.
This month, the Miami-Dade Property Appraisers’ Office issued $1.7 million in tax liens against assisted-living facilities that claimed homestead exemptions — resulting in a discount on their property taxes — to which they were not entitled, the office said. Under Florida law, an ALF owner must live on the property in order to qualify for a homestead exemption — which lowers the tax burden only for the portion of the facility in which the owner lives, not for any part of the home that generates income.
Of close to 200 homes that were cited by the department, 98 were ALFs or other group homes where the owner did not live on-site — meaning they were not eligible for any tax relief.
Carlos Lopez-Cantera, Miami-Dade’s property appraiser, said he came up with the idea of comparing homesteaded properties against ALFs licensed by the state after receiving many complaints about the homes from constituents while he was representing Miami in the state House of Representatives. To test his theory, the office looked at a handful of the properties, and, Lopez-Cantera said, found that a large number of them were homesteaded — meaning the homeowners were asserting that the properties were their place of residence. Instead, they were licensed by the state to provide care to frail elders and disabled people.
“When someone receives an exemption they are not entitled to, it increases the burden on all other property owners,” Lopez-Cantera said. “While these facilities provide important services, they cannot be allowed to ignore the law to the detriment of others.”
Lopez-Cantera said his office continues to examine the tax records of county ALFs, and expects to find other homes that are evading their tax obligations . Miami-Dade has more licensed ALFs, by far — 998 — than any other county in the state. The state licenses 3,044 ALFs, with 70,719 beds, overall.
Under Florida law, violations of the homestead statute are assessed back taxes with a 50 percent penalty and 15 percent interest. Lopez-Cantera said his office also referred the ALFs on his list to the Miami-Dade state attorney’s office, but added prosecutions are unlikely because the tax-avoidance was only a misdemeanor.
Among the ALFs caught obtaining improper exemptions: Intraqual Premier ALF, a Miami Gardens home that was run by a woman on house arrest after being charged with bilking Miami’s cash-strapped public hospital out of more than $83,000 by creating “ghost employees” and then paying them with taxpayer money.
The state Agency for Health Care Administration yanked Intraqual’s license in January. In an administrative complaint filed in November, healthcare administrators said owner Tiffany Gordon violated state law by running the home while awaiting trial on fraud charges.
Last September, Gordon was charged with fleecing the struggling public hospital by hiring two pals and paying them $49,301 and $34,323, mostly to do nothing. The case remains open, and Gordon pleaded not guilty, though court records say she is scheduled to enter a new plea.
The property appraiser’s office said Gordon was running a six-bed, 1,500-square-foot ALF at 19117 NW 33rd Ave. Gordon was not living at the home, Lopez-Cantera said, so she did not qualify for any homestead exemptions. The appraiser said she is facing $7,000 in fines.
Long the subject of criticism by neighborhood groups and elder advocates, the state’s assisted-living industry came under withering scrutiny two years ago when The Miami Herald published a series of stories, called Neglected to Death, that found dozens of people dying of abuse and neglect, with caretakers tying frail residents with ropes and forcing them into closets. In the series’ wake, several of the worst home were shut down, while others faced oversight that had not been seen in decades. Gov. Rick Scott created a two-year task force that studied the industry and recommended a host of reforms that the Legislature ignored.
Brian Lee, a former statewide, long-term care ombudsman who now runs an elder advocacy group called Families for Better Care, said many owners — particularly of the small, mom-and-pop homes that flourish in Miami and Hialeah — poor-mouthed the industry at the public hearings held by Scott’s task force the last two years. “They do make a lot of money, a significant amount of money, and still provide substandard care and offer third-rate food.,” he said. “Yet we see assisted-living facilities selling for hundreds of thousands of dollars because the market is so good.”
“I find it hard to believe,” he said, adding the homestead exemptions appear to be “just another way for them to make a few extra hundreds of dollars till they get caught. And, once they get caught, they may stop.”
Pat Lange, who is the executive director of the state’s largest ALF industry group, the Florida Assisted Living Association, said she was “struck” by Miami-Dade’s failure to catch the ALF tax cheaters, given the large amount of money at stake. “We applaud Lopez-Cantera for taking this action, if it was done appropriately,” she said.
But, Lange added, her group is concerned that some of the ALFs on the county’s scofflaw list may not actually be ALFs. The state licenses a variety of congregate living arrangements, Lange said, and a news release issued by the property appraiser’s office left open the possibility that some of the homes being fined might be adult family care homes, or other types of group homes that may be entitled to a homestead exemption.
““While we know that some don’t play by the rules, we don’t want people to paint the whole industry with the same brush,” she said.
For the full story: http://www.miamiherald.com/