The bill extends a refundable income tax credit for qualifying seniors to include the income tax years commencing on January 1, 2025, and January 1, 2026.
A qualifying senior is a resident individual who:
Is 65 years of age or older at the end of the income tax year
Has a federal adjusted gross income (AGI) of $75,000 or less if filing a single return, or $125,000 or less if filing a joint return
Has not claimed the senior property tax exemption for the property tax year that coincides with the income tax year
The amount of the credit for the 2025 and 2026 income tax years is:
$800 for a single filer with a federal AGI of $25,000 or less, reduced by $8 for every $500 above $25,000
$800 for joint filers with a federal AGI of $25,000 or less, reduced by $4 for every $500 above $25,000
$400 for each taxpayer in the case of two taxpayers sharing a primary residence, filing separately, and both claiming the credit, reduced by $4 for every $500 above $25,000
Additional eligibility:
Taxpayers who qualify for a property tax and rent assistance grant or heat assistance grant in 2025 or 2026 are eligible for the full credit amount regardless of income-based reductions
The bill also requires:
The property tax administrator to provide reports from counties on taxpayers eligible for and claiming the homestead property tax exemption
Summary
Legislative Oversight Committee Concerning Tax Policy. Section 2 of the bill extends a refundable income tax credit (credit) that is available for the income tax years commencing on January 1, 2022, and January 1, 2024, so that the credit is also available for the income tax years commencing on January 1, 2025, and January 1, 2026.
For each income tax year, the credit is for a qualifying senior, which means a resident individual who:
•
Is 65 years of age or older at the end of the income tax year;
•
Has federal adjusted gross income (AGI) that is less than or equal to $75,000 if filing a single return, or less than or equal to $125,000 if filing a joint return; and
•
Has not claimed the senior property tax exemption for the property tax year that coincides with the income tax year.
The amount of the credit for both the 2025 and 2026 income tax
years is:
•
$800 for a qualifying senior filing a single return with federal AGI that is $25,000 or less. For every $500 of federal AGI above $25,000, the amount of the credit is reduced by $8.
•
$800 for 2 taxpayers filing a joint return with federal AGI that is $25,000 or less. For every $500 of federal AGI above $25,000, the amount of the credit is reduced by $4.
•
$400 for each taxpayer, in the case of 2 taxpayers who share the same primary residence, and may legally file a joint return but actually file separate returns and both claim the credit. For every $500 of federal AGI above $25,000, the amount of the credit is reduced by $4.
Notwithstanding the income-based reductions in the allowable
credit amount, a taxpayer who also qualifies for a property tax and rent assistance grant or heat assistance grant during the calendar year 2025 or 2026 is eligible to receive the full amount of the credit. Section 1 requires the property tax administrator to provide reports
from counties related to taxpayers who are eligible for and actually claim the homestead property tax exemption.
