'Circuit Breaker' Tax Relief

JANUARY 2002 -
Eligible Members File This Year - Homeowners and renters, who are 65 or over before this January 1, can
file for the circuit breaker tax relief this year. For specifics, refer
to our earlier reports on the program in the January and March issues
of the Voice.

UPDATE: PREVIEW THE 2001 TAX FORMS
For your review, the 2001 Circuit Breaker Form (Schedule CB), which the
Department of Revenue is preparing in conjunction with the 2001 State
Income Tax Return (Form 1) are online here. Since the Schedule CB
refers to line 38 on Form 1, we have also included the 2001 Form 1.
Be advised that these forms are being provided simply as a preview and
should not be used to formally apply for the circuit breaker tax
relief. You should obtain these forms directly from the Department of
Revenue.

As
a quick recap, members must not only be at least 65 last year (2001)
but also have an income less than $41,000 (single) or $61,000
(married). (Editors Note: The original $40,000 and $60,000
income caps have been upped due to inflation.) It's important to
remember that income, for purposes of the circuit breaker, includes
your public pension and social security, which remains totally exempt
from Mass personal income taxes.

Those
members, who qualify, will be able to get a tax credit or a refund on
their real estate taxes that exceed 10% of the income, up to $385.
Renters will use 25% of rent they pay as the amount of real estate
taxes in their calculation.

Even
if you don't file a state income tax return, you will have to do so in
order to file for the circuit breaker. There will be a separate form,
known as the Schedule CB, to be completed along with the standard state
return (Form 1).

It's
understandable that members, who normally don't file state tax returns,
may find the process overly complicated and burdensome. However, one
can receive up to $385 in tax credits or direct refunds so that it
could prove financially worthwhile to take time and fill out the
necessary forms for the circuit breaker relief.

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