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Senior Q&A: You may be eligible for Circuit Breaker tax credit

Posted by Marcia Dick  February 23, 2012 10:02 AM

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The newest Q&A column from Dan O’Leary, executive director of Mystic Valley Elder Services. Please contact him with any questions or column topic suggestions at 781-324-7705 or info@mves.org.

 
QUESTION: Someone at the senior center mentioned the Circuit Breaker tax refund. I told her that I don’t usually file taxes, but she said that I could get it anyway. Is this true, or just one of those “too good to be true” rumors?

ANSWER: It’s pretty exciting when one of those too-good rumors turn out to be true, right? And this one is: the Circuit Breaker Tax Credit is available to folks 65 and older who live in Massachusetts, even if you don’t usually file taxes. If you’re eligible, it’s basically money in your pocket. You are eligible if:

1. you are a Massachusetts resident,

2. you are who are 65 years old or older,

3. you paid rent or real estate taxes in 2011,

4. your income is $52,000 or less (or $65,000 or less for head of household, or $78,000 or less for joint filers), and

5. you’ve paid more than 10% of your income in real estate taxes.

The maximum credit for 2011 is $980. The actual credit you receive will depend on your income and how much you paid in real estate taxes. If you’re a renter, the state assumes that 25 percent of your yearly rent went to real estate taxes. If you’re a homeowner, you can also include 50 percent of your water/sewer bill when calculating how much you paid in real estate taxes. Even though those taxes went to your city or town, the Commonwealth of Massachusetts issues you the tax credit.

And yes, you can claim the Circuit Breaker Tax Credit even if you wouldn’t file taxes otherwise. Just file a state return and include the Schedule CB, which is where you calculate and request your credit. Schedule CB is available on the Massachusetts Department of Revenue’s website, along with the other necessary forms.

(Of course, since this is a conversation about taxes, there must be exceptions. You are not eligible for the Circuit Breaker Tax Credit if you and your spouse will file separately; if someone else can claim you as a tax dependent; if you are living in federal- or state-subsidized housing; or if your home was worth more than $729,000 as of January 1, 2011.)

If this is the first you’ve heard of the Circuit Breaker Tax Credit, you can even file this year to get the credits you were entitled to for 2008, 2009, and 2010 (if you were eligible each of those years).

AARP offers free tax help to Massachusetts residents 60 and over. Give them a call at 1-888-227-7669. You can also try going right to the source and calling the Massachusetts Department of Revenue with your questions, at 1-800-392-6089.

Mystic Valley Elder Services provides critical life-supporting care to elders, adults with disabilities, and caregivers in Everett, Malden, Medford, Melrose, North Reading, Reading, Stoneham, and Wakefield. For more information, go to mves.org.



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