City Assessor: State Tax Credit for Seniors Available
Can Claim Refundable Credit Against Personal Income Taxes
– Allison Goldsberry
According to Medford’s Chief Assessor, Ed O’Neil, some of Medford’s seniors could be eligible for a state tax credit on their 2007 tax returns.
Since 2001, state law has allowed residents 65 years of age and older that are owners or renters of a principal residence to claim a refundable credit against their personal income tax returns based upon real estate taxes or rent paid.
The “circuit breaker credit,” as it’s referred to by state officials, does have its income and property tax value limitations. Also, the maximum credit allowed for both homeowners and renters is $900.
For 2007, eligible seniors include single individuals that are not the head of household earning $48,000 or less, $60,000 for a head of household, and $72,000 for a married couple filing a joint return.
In addition, the assessed value of a homeowner’s principal residence- before residential exemptions but after abatements- must not exceed $772,000. Only 1 acre of land or less will be considered in the assessed value.
The assessed value limit changes each year and is based upon the average assessed value of single family homes in the state.
For homeowners, the credit amount is equal to the amount by which their property taxes, including water and sewer charges but excluding abatements and exemptions, exceeds 10% of total income. Renters’ credits equal the amount by which 25% of the rent paid exceeds 10% of total income. Credits for homeowners and renters are capped at $900.
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