Tax Payment Application

Maine Municipal Tax Collectors & Treasurers Association

Posted 12/7/04: Has your Town/ City adopted a policy pursuant to 36 M.R.S.A. $ 906 of applying all tax payments to the oldest outstanding tax obligation? If you do have a policy would you be willing to share a copy of the policy with us? Or if you do not have a policy how do you deal with the tax payments?

Sharon Woodward
Deputy Tax Collector
PO Box 159
Richmond, ME 04357
tel. 737-4305 ext. 201
fax 737-4306
email sharonwoodward@richmondmaine.com

Responses: Sharon, Gray has not formally adopted the policy but follows it and when a citizen requests otherwise we first inform them of the consistent practice and then comply with their request. (Mitch Berkowitz, Gray)

That policy was adopted in Sanford. First at the November 16, 1999 Town Meeting Article 13 "To see if the Town will authorize the Tax Collector and/or Treasurfer pursuant to Title 36, Maine Revised Statutes Annotated, ss 906, to apply any tax payment received from an individual as payment for any property tax against outstanding or delinquent taxes due on said property in chronological order begining with the oldest unpaid tax bill, including any outstanding interest and cost(s), provided, however, that no such payment may be applied to any tax for which an abatement application or appeal is pending unless approved in writing by the taxpayer?" was adopted, then the Board of Selectmen of the Town of Sanford adopted this policy upon that Town Meeting Authorization on March 7, 2000.

Whenever we collect payment on oldest tax, we put a notice with the receipt showing the policy.

Hope this helps (Claire Morrison in Sanford)

I'll fax you a copy of Lincolnville's policy. Sorry that I don not have it in electronic format.
(David Kinney, Lincolnville)

It’s not much, but it’s what we have in Lamoine:(Stu Marckoon)

Policy Regarding Application of Funds to Accounts Receivable

Effective Date: June 24, 1992

The Lamoine Board of Selectmen hereby directs that all funds expended through the Town’s Sludge, abatements, or other accounts should be applied to those accounts receivables that are due to the Town through liens and taxes. The only exception would be the application of General Assistance funds being applied to those accounts receivable.

All Septic Sludge bills should be checked against all liens, taxes receivable and other accounts due.

/s/ Richard Davis, Selectman

/s/ Evelyn Farrell, Selectman

/s/ Nathan Anderson, Selectman

/s/ Barbara Bartosenski, Town Clerk

June 26,1992

We have an article on the annual Town Meeting Warrant stating: To see what action the Town wishes to take in regard to authorizing the Tax Collector to collect interest and costs before applying funds to the principal of the oldest outstanding tax assessment. With a motion: to authorize the Tax Collector to collect interest and costs before applying funds to the principal of the oldest outstanding tax assessment.

Nikki M. Verrill
Tax Collector
Town of Minot

I shall fax you one of my memos and the motion that the City Council of
Presque Isle annually approves via vote in this regard.
Spike Savage

The Town of Frankfort does have a policy to apply tax payments to the oldest outstanding year. I can send you a copy if you like. It is simply a statement signed by the selectmen and posted on the wall.

Melissa...Town of Frankfort

The Town of Hancock passes a warrant article each year that reads:

To see if the Town will vote to approve undesignated tax payments to be applied to personal property taxes, if applicable, then to the oldest tax bill. (Stacey Clement)

The Towns of Mapleton, Castle Hill and Chapman each adopted a policy which is identical to the wording of Sanford's. We have an added line at the bottom that states, "This Order shall remain in effect until rescinded by the Municipal Officers." It was written as an "Order of the Municipal Officers" and signed as such instead of an article at Town Meeting. It is the format suggested by MMA in the Maine Townsman Magazine dated March 2003. MMA also warns against certain limitations to this policy, however. The law only refers to payments received "from an individual" and apparently does not apply to corporate or other "legal" persons. Also, payments can only be applied to taxes on the property for which payment was made, meaning that a payment made on one property can't be applied to other property taxes owned by the same individual, even if the property taxes are older. Finally, payment cannot be applied to taxes for which an abatement application or appeal is pending unless the taxpayer approves in writing that this is ok. (Tammy Getchell)

I think that if you look at the Municipal Officials or Tax Collector Treasurer's manual you have a sample policy there. I also believe that it can become a policy and the Selectmen adopt it. Easier than a warrant article that way you do not have to have the voters get in on policy decisions. (Eva Leavitt, Turner)