As we continue our efforts to keep Scotch Plains as an affordable place to live and grow – proposing a municipal budget with a zero tax increase – it is also important for our senior citizens to know of tax-saving programs that are available to them.
I want to encourage all eligible seniors in Scotch Plains to take advantage of property tax exemption programs on the state level. In attending events around town, I was surprised to learn that some of our seniors are unaware of a number of property tax benefits designed to make it easier to retire here.
And, so, in deciding the topic for my column in the E-Messenger, please allow me to outline some of the state programs that can really improve the quality of life for our friends and neighbors in Scotch Plains.
Below are examples of some very important programs that may save you money:
- The Senior Freeze program provides eligible seniors with a property tax reimbursement to compensate for increases in property taxes. To qualify, you must have lived in the state for 10 consecutive years and have owned and lived in your current principal residence for at least three of those 10 years. There are also income requirements, providing help to those who need it the most.
- New Jersey also offers the Homestead Benefit program, which provides targeted tax breaks to seniors, people with disabilities, and other low- and middle-income homeowners. Those making up to $75,000 annually are eligible for Homestead benefits, as are seniors and homeowners with disabilities who make up to $150,000 annually.
You may recall this program was first launched as a rebate check, but most recipients who qualify now receive their benefits as a direct credit on their local property tax bills.
- Here is another benefit: Seniors who are aged 65 or older, or disabled, and have been a New Jersey resident for at least one year, are eligible for the Senior Citizens and Disabled Persons Property Tax Deduction. The benefit allows an annual $250 deduction from real property taxes to be claimed for the dwelling of a qualified senior citizen, person with disabilities or their surviving spouse.
- Homeowners and tenants, including seniors, who pay property taxes on a primary residence in New Jersey, either directly or through rent, may qualify for either a property tax deduction or a refundable credit when filing their New Jersey gross income tax return.
- The property tax deduction reduces your taxable income. You can deduct your property taxes paid or $15,000, whichever is less. For tenants, 18% of rent paid during the year is considered property taxes paid.
- The property tax credit reduces your tax due because it is subtracted directly from your tax liability. The benefit is a refundable credit of $50.
Taxpayers are permitted to claim whichever results in the greater tax benefit when filing their annual income tax return.
If this all may seem complicated to you, I understand. But it is important that our local seniors are aware of every benefit they deserve. I hope that this brief guide serves as a resource, and that all eligible residents in Scotch Plains take full advantage.
