If you are age 65 or over, own and reside in your primary residence, and your income is less than $86,000, you could be missing an opportunity to save hundreds, if not thousands, of dollars each year.
Every March 1, each town has a state imposed deadline requiring applications to be submitted to the local tax assessor’s office in order for homeowners to receive tax reductions for that year’s school taxes. You may qualify for Star (School Tax Relief Program). There are three levels of Star: Basic Star, Enhanced Star and Low Income Star.
The focus of this article is the Enhanced Star Program. I meet many seniors who could qualify for this benefit, but fall into two categories: first, they did not know additional benefits existed for seniors beyond the basic Star exemption or second, they knew about it but did not think they met the income requirements of the program.
To qualify for Enhanced Star, you have to: apply each year by March 1; your home has to be your primary residence; one of the owners has to be at least age 65; and for 2017, your total pre-tax income as a single or couple owning the home has to be less than $86,000 (based on your 2015 tax return).
Seems simple enough, but the income limit is the most challenging hurdle. When I review tax returns to evaluate whether seniors qualify for the Enhanced Star Program, they are shocked that their income may be showing greater than $86,000, but they still qualify for the program. Why? The income limit figure of $86,000 (which increases periodically with inflation) should notinclude IRA distributions. Consequently, your taxable income could be more than $86,000 and still qualify for the benefit. The program may save you significant money annually.