In 2018, 18 states and Washington, D.C. offered a circuit breaker program, providing property tax exemptions or credits for qualifying homeowners and renters. The tax break is not automatic – you have to claim it by completing the mandated form and filing it with the county treasurer's office. The program is intended to help seniors and low-to-moderate income households. It kicks in when too much of your income would be spent on property taxes.
Determine Your Eligibility
Circuit breaker property tax credits or rent rebates are available to "eligible individuals," a category of persons that typically includes seniors, persons with disabilities and those in receipt of Social Security Disability, Supplemental Security Income or Veterans' Disability. Rules vary by jurisdiction, so check whether you qualify by calling your county auditor's or treasurer's office.
Calculate Your Total Income
To apply for circuit breakers, your annual income must be less than the statutory state threshold. For example, Missouri renters must have an income of $27,500 or less for a single person, or $29,500 or less for a married couple filing jointly. For Utah homeowners, the household income limit is $33,530 in 2018. You might also have to pass a residency test, such as proving that you've lived in the state for at least a year. Call the county for specific information.
Gather Your Documents
You'll need to supply proof of income and residency, so gather the following documents before you fill out the application:
- Proof of eligibility, for example, Form SSA-1099 or a letter from the Department of Veteran's Affairs.
- Proof of income for all members of the household, for example, forms W-2, 1099, 1099-R, 1099-DIV, 1099-INT and 1099-MISC .
- Details of the social security benefits you've received, for example, forms SSA-1099, RRB-1099, or an SSI Statement.
- A copy of your rental agreement.
- The amount of property taxes paid in current year.
- Proof of residency, if your state requires you to show that you've lived in the state for a certain period.
Prepare Your Filing
Your county may use a statewide application form, or it may have its own form. Visit the county auditor's or treasurer's office website for the correct forms, or telephone the county office before submitting. Be aware that some states, such as Massachusetts, require that you file a state tax return to claim circuit breakers, even if you aren't obligated to file otherwise. Prepare your filing carefully, attaching copies of any letters or forms required with the claim. Sign and date your form and mail it to your county office.
Take Care with Filing Dates
Some counties accept circuit breaker applications only during a filing window – check with your county office. If you miss the filing date, you'll have to persuade the county to accept your late application. Some jurisdictions will help you if you can show that you had a good reason for missing the deadline. Otherwise, the county will reject your application, and you will have to file again during the next window.
- Institute on Taxation and Economic Policy: Property Tax Circuit Breakers
- City of St Lous: Apply for Property Tax Credits and Rent Rebates (Circuit Breaker) for Seniors and Persons with Disabilities
- Utah State Tax Commission: Circuit Breaker – Low Income Abatement & Homeowner's Tax Credit
- Utah State Tax Commission:Circuit Breaker – Renter Refund
- Commonwealth of Massachusetts: Learn about the Circuit Breaker Credit
- UNC School of Government: “Good Cause” and Late Property Tax Exemption Applications
- Institute on Taxation and Economic Policy: Property Tax Circuit Breakers in 2018
- Missouri Property Tax Credit
- Utah State Tax Commission: Property Tax Abatement, Deferral and Exemption Programs for Individuals
- Although programs such as the AARP Tax Aide program focus on federal taxes, they are staffed by local volunteers who, as specialists in serving the tax needs of seniors, are likely to be able to help with local programs as well.
- You may be able to file for prior year payments that you failed to claim. This may require amending prior year tax returns if you filed them. There are usually time limits that apply, so if you believe that this is possible, do not delay in investigating this option.
Jayne Thompson earned an LL.B. in Law and Business Administration from the University of Birmingham and an LL.M. in International Law from the University of East London. She practiced in various “Big Law” firms before launching a career as a commercial writer. Her work has appeared on numerous legal blogs including Quittance, Upcounsel and Medical Negligence Experts.