Property Tax Documents
- DOR Link Regarding the 2015 Circuit Breaker: http://www.mass.gov/dor/businesses/help-and-resources/legal-library/tirs/tirs-by-years/2015-releases/tir-15-11.html
- Circuit Breaker Anytown
- Circuit Breaker Worksheet Anytown
- Tax Task Force Letter
- Property Tax Work Off Legislation
- Synopsis of Requested Action
Q & A continued….
Q: A senior asked a COA Director why we don’t give preference to single people as opposed to two income households when choosing the tax work off applicants. The director noted that she currently uses the Circuit breaker income guidelines and while she sees the point of the senior, can’t imagine the backlash that the COA would get, not to mention all the other issues that could arise from attempting to do that. Have you heard of any other town using this criteria?
A: I have not heard of anyone giving preference to either singles or two income households. Towns can create their own guidelines within the framework of the law however, so if you all do decide to make some changes in your program, please let me know. Also, I would suggest that if you want to make changes, establish a committee – such as the Town Admin, Finance, Assessor, Comm. On Disabilities, Veteran’s Agent, Nurse, etc. to take responsibility with you!
Attached is our latest application – we have created a kind of sliding scale in order to manage as many people as we have in the program – but there is a place for one and 2 person households.
Q: I am trying to confirm that gross Income from all sources is the figure used to determine income eligibility for the tax work off program. Even though people do not have to pay taxes on their Social Security income, that gross figure should still be counted with any other gross income to determine their eligibility, not the adjusted gross income that appears on their 1040 form. Please confirm or correct my understanding of this right figure to use.
A: There is no income requirement for eligibility in the work-off program unless the town establishes one. Re reporting of the abatement as income to the IRS -- it is the amount of the abatement that is considered reportable - plus whatever the person normally reports as income to the IRS. See the attached guidelines from the MA DOR.
Q: I am looking for some information about 1099 versus W2 for Senior Workers in the Tax Work-Off Program. [Our town] wants this to be done in accordance with IRS rules so we can open this program up for more participation.
A: Towns sometimes handle this differently although all should be in compliance with the IRS. Below are links to the IGR (DOR's guidelines release) and also a clear explanation that Westford has shared online here.
MA DOR Guideline Release
The amount by which a person's property tax liability is reduced in exchange for the volunteer services shall not be considered income, wages or employment for purposes of taxation as provided in chapter 62, for the purposes of withholding taxes as provided in chapter 62B, for the purposes of workers' compensation as provided in chapter 152 or any other applicable provisions of the General Laws. While providing such volunteer services, that person shall be considered a public employee for the purposes of chapter 258 and those services shall be deemed employment for the purposes of unemployment insurance as provided in chapter 151A.
Excerpt from Westford's Veteran's Property Tax program:
Under IRS regulations, any individual participating in the Veterans Work Program which provides a reduction in property tax in return for services must have federal and Medicare taxes withheld.
The Town of Westford is a municipal employer, we do not deduct Social Security but are required to withhold OBRA (Omnibus Budget Reconciliation Act), a retirement withholding of 7.5% of all earnings. A Veterans Tax Work program participant may request a refund of all of the monies contributed to your account once you cease to be employed by the town.When you completed your hours and receive your tax write off you may resign from the program. COA upon receiving written notice of resignation will then forward the same to HR and they will trigger a termination of your OBRA active status. The (ex) employee then must submit the OBRA request for distribution directly to Great West Retirement Services for their OBRA refund.
Circuit Breaker Tax Credit
The Massachusetts "CIRCUIT BREAKER" TAX PROGRAM is for persons 65 or over whose property taxes (or 25% of rent) exceed 10% of their annual gross income and who meet other qualifying criteria. You may be eligible even if you receive a property tax exemption through your city/town.
"Senior $ents" — DOR /Massachusetts Elder Affairs Resource
The Department of Revenue teamed up with Elder Affairs to put together an awareness campaign to educate seniors about the many state income and local property tax breaks they may be eligible to claim. We have developed an eligibility flyer for the senior circuit breaker and sent out a news release which explains the tax relief in greater detail.
Of Interest RE Foreclosures...
[ Excerpt ] "What happens to a house when the beleaguered owner moves out, and the lender never finishes the foreclosure paperwork? — It becomes a 'zombie house.'
The term "zombie house" applies because the absent homeowner is still legally responsible for the foreclosed property and can be haunted by:
- Property taxes.
- Homeowners association fees.
- Fines for building code violations.
- Other expenses. "
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