Senior Citizen Deduction on Real Property

I just need to post something and people keep forgetting about this very generous deduction for senior citizens who own their homes. The DC government does take into account low income homeowners as well as low income senior citizens, but I’ll talk about low income in another post. This post is about old people. The thing is they need to apply, it is not automatic. You don’t get a deduction on you 65th birthday. DC government is not tracking you, it is not that organized.

So you’re old (65+) and you own your home but the property taxes keep going up and up, what are you to do? One, are you getting a homestead exemption? If not, why not? Are you not living in a residential property? If you live above your liquor store that you run, sorry no deduction for you. That’s a commercial property, probably. This is for a house, a townhome, a duplex, a triplex (and anything 5 units or less) or a condo. But most importantly this residential property must be your primary residence. The homestead deduction should take off $73,350 from the assessed value.

Okay so you have the homestead deduction. Great. Are you 65 or older? Here is what the Office of Tax and Revenue says,” When a property owner turns 65 years of age or older, or when he or she is disabled, he or she may file an application immediately for disabled or senior citizen property tax relief. This benefit reduces a qualified property owner’s property tax by 50 percent.” 50%!! Half off from regular priced taxes. Old timers whose house is worth over a million dollars will be taxed like their house is over HALF a million dollars. But what if it is a couple living in the house and one is 65 and the other is say 35? There are things I could say but they’re judgey and not polite. As long as the 65 year old owns 50% of the house or condo or whatever it’s still good.

But wait you say, “I’m 65 years old and on a low fixed income, half off does not cut it.” Well guess what, you can have your taxes deferred. I understand the 0% deferral, not so much the 6% deferral. I am familiar with ‘deferring’ things like student loans, it just means you don’t have to pay now, but it’s gonna get paid. With seniors I figure it just means those taxes have to get paid when grandma goes to the great beyond. Maybe that’s why this particular program needs your lender’s okay. Anyway, low income means a household Federal Adjusted Gross Income (AGI) of $50,000 or less. You get the 0% deferral if you are 75 years or older, have lived in your home 25+ years and make no more than $12,500 from dividends and interest. But you get nothing if you don’t fill out and send in the application (Word .doc file).

So if there is an old timer complaining that all these young white whippersnappers are moving in and raising their taxes, ask them if they have taken advantage of the real property programs for seniors and offer to help them fill out the application. Also remind them that nursing homes are friggin’ expensive and Medicare doesn’t cover everything, so having an ever increasing in value asset is a good thing…. provided their pot head daughter doesn’t blow all the proceeds from the sale of the house once she gets power of attorney…. Yes, apparently I’m still pissed off with my sister in law.

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