TAX SEASONSubmitted by Antaeus Wealth Advisors on February 8th, 2017
“In this world nothing can be said to be certain, except death and taxes.”
As we head into tax season, now is a great time to examine some of the lesser known tax credits available to Massachusetts residents and how they could potentially benefit you on your Massachusetts income tax return.
One of the biggest credits available is the Real Estate Tax credit, also known as the Circuit Breaker credit. Certain taxpayers age 65 or older may be eligible to claim this credit up to $1,070 for tax year 2016 if they meet specific criteria. This credit compares the amount paid in real estate taxes or amount paid in rent against your total adjusted gross income. Renters as well as homeowners whose primary residence is assessed at $693,000 or less may potentially take advantage of this generous credit.
Generally, taxpayers age 65 and older would qualify for all or a portion of this credit if the combined total real estate payments on their primary residence and one half of the total yearly water bills is greater than 10% of their adjusted gross income (including social security). For taxpayers who rent, they would qualify if one quarter of the yearly rent paid is greater than 10% of their adjusted gross income.
If you are age 65 or older, take the time to consider your individual situation to see if this credit could possibly apply to you. As a refundable credit, even if you have no tax liability in Massachusetts, you could claim the credit as a refund on your tax return.
As always, please remember to consult your tax advisor before making any final tax decisions.