December 8, 2009
ALBERT HECKERS, PLAINTIFF-RESPONDENT,
DIRECTOR, DIVISION OF TAXATION, DEFENDANT-APPELLANT.
On appeal from the Tax Court of New Jersey, Docket No. 6503-2008.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Submitted: October 21, 2009
Before Judges Cuff and Payne.
This appeal, as the appeal in the companion case of Lawrence Kagen v. Director, Division of Taxation, A-1431-08T2 also decided this date, addresses the good cause provision of N.J.S.A. 54:4-8.62a for an extension of time to file an application for a homestead rebate. In each case, the taxpayer contended a medical condition prevented him from filing the application on a timely basis. The Director, Division of Taxation (Division) denied plaintiff's application for an extension; a judge of the Tax Court reversed; and we affirm.
Albert Heckers, a first time home buyer, purchased a home on September 25, 2006. He qualified for a 2006 homestead rebate because he owned a home on October 1, 2006. Heckers filed his 2006 New Jersey Gross Income Tax Return in early 2007. In doing so, he filled out a circle on the form to indicate he owned a home on October 1, 2006. Heckers believed he had applied for a homestead rebate for 2006.
By Fall 2007, Heckers became concerned that he had not received his rebate check. Concurrently, he suffered a herinated disc in his back over Labor Day weekend and underwent a surgical procedure on his back in October 2007. His recuperation extended over three months during which he required assistance for many basic events of daily living.
As a result, Heckers did not investigate the missing rebate check until December 4, 2007, when he sent an email to the Division. The agency responded and informed Heckers that he had to file a separate application. In early January 2008, when Heckers replied with further questions, the Division provided him with a link to its website and the 2006 Homestead Rebate application. He completed the application. The Division received it on January 11, 2008, denied the application on March 5, 2008, but informed him that it would reconsider his application if he provided medical evidence that he was unable to file a timely application due to illness or a hospitalization.
Heckers submitted a letter dated March 18, 2008, from his doctor, who explained that he had surgery in October 2007 and his recovery extended over two months. On April 22, 2008, the Division denied his application again. The Division informed Heckers that the "documentation does not substantiate that [he] filed or attempted to file timely."
Heckers filed a timely complaint in the Tax Court. Following a trial, Judge Menyuk found that the taxpayer established medical cause for not filing a timely rebate application. In response to the Division's argument that Heckers was able to attend to his financial affairs during his convalescence, the judge found that Heckers paid recurring bills for which he had statements or received bills, and which only required writing a check or initiating an on-line payment. She distinguished payment of his recurring financial obligations from a non-recurring homestead rebate application for which he did not have the form. Moreover, the judge noted that Heckers acted promptly once his physical condition allowed him to communicate with the Division.
On appeal, the Division argues that an extension is available only for those taxpayers who demonstrate medical inability to file a timely application. It also contends that the taxpayer did not present sufficient evidence to invoke the medical good cause exception.
An application for a homestead rebate must be filed annually and for 2006 was due on August 15, 2007, or filed by the extended deadline of October 31, 2007. Prior to 2004, the statute governing homestead rebates recognized a good cause exception to the timely filing requirement but it was strictly construed. In Hovland v. Director, Division of Taxation, 6 N.J. Tax 473 (Tax 1984), aff'd, 204 N.J. Super. 595 (App. Div. 1985), certif. denied, 102 N.J. 400 (1986), the Tax Court allowed a taxpayer who had not filed a timely application due to medical reasons to receive a homestead rebate. There, the taxpayer had spent several months in the hospital following diagnosis and treatment of a serious spinal cancer condition. Id. at 475. The taxpayer filed the application when he returned home and it arrived just four days after expiration of the filing deadline. Ibid. In overturning the agency decision to deny a rebate, the Tax Court rejected the agency position that a taxpayer must be totally disabled and without anyone to assist him to fulfill his obligations. Id. at 480-81. We held that the taxpayer's "severe and incapacitating illness," coupled with his good faith attempt to file a timely application, excused his failure to comply with the strict terms of the program. Hovland, supra, 204 N.J. Super. at 600.
In 2004, the Legislature amended the statutory good cause exception. As amended, the statute provides that a taxpayer must submit medical evidence that the taxpayer was unable to file an application as prescribed due to a hospitalization or illness or evidence that the taxpayer attempted to file a timely application. N.J.S.A. 54:4-8.62a provides in pertinent part:
For the purposes of this subsection, in order to establish good cause to extend the time of any applicant to file a claim for a homestead rebate or credit the applicant shall provide to the director either medical evidence, such as a doctor's certification, that the claimant was unable to file the claim by the date prescribed by the director because of illness or hospitalization, or evidence that the applicant attempted to file a timely application. Except as may be established by medical evidence of inability to file a claim, good cause shall not be established due to a claimant not having received an application from the director.
The only reported opinion following adoption of this amendment, Bonda v. Director, Division of Taxation, 22 N.J. Tax 77 (Tax 2004), held that the taxpayer did not establish that her numerous and serious medical conditions excused her untimely filing of her rebate application. Notably, other than listing her various medical conditions, the taxpayer submitted no evidence from a treating physician that she was medically unable to file the application in a timely manner. Id. at 82.
Here, unlike Bonda, Heckers submitted a certification from his physician that his orthopedic condition required surgery and a prolonged period of recuperation. Heckers testified that his activities were severely restricted during this period and he required assistance in many of his daily activities. His ability to keep current on his financial obligations was restricted to recurring bills. It was not until early December that he was able to pursue matters that required some investigation, such as his homestead rebate application. The Director submitted nothing to contradict the physical limitations described by Heckers.
A "good cause" standard requires a case-by-case assessment. Although Heckers may not have suffered the degree of disability experienced by the taxpayer in Hovland, we conclude that his case, as supported by uncontradicted medical evidence, is closer to Hovland than Bonda. We, therefore, affirm the Tax Court order reversing the denial of Hecker's homestead rebate application for the year 2006 and ordering payment of the rebate.
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