Tax credits could replace freeze refunds for seniors

On Thursday, lawmakers will weigh pro-efficiency reform over a popular tax relief for New Jersey’s elderly and disabled residents.

A Senate panel will consider two Sens-sponsored bills. Shirley Turner (D-Mercer) and Vin Gopal (D-Monmouth) who would offer rewards given under the state’s senior freeze program in the form of tax credits instead of rebates, a change according to supporters would provide relief more quickly and at less cost to the state.

The senior citizen freeze program aims to freeze property tax rates for eligible homeowners, with the refund equal to the difference between their current property tax bill and the bill in the year they moved into their home.

But there is a catch. Because New Jersey distributes freeze bonuses to senior citizens as a rebate, elderly and disabled residents must still pay their property tax bills in full, and depending on when a resident files their claim, they may he may not see his discounts for months.

“It’s like a day late and a dollar short because you don’t get the check until the next year,” Turner said.

Seniors’ freeze applications for 2021 tax returns close October 31, and those applying now could wait until December to receive their refunds.

“Imagine seniors on a fixed income. They have to pay their property tax and they have to wait for a refund to be available to them,” Gopal said. “It looks like a lot of bureaucracy in the middle. That’s what this bill fixes.

Under the plan Gopal and Turner proposed, eligible residents would pay their first two-quarter property tax bills and then receive credits that would reduce third- and fourth-quarter bills.

The average property tax bill in New Jersey was $9,248 in 2021 and, according to the Tax Foundation, a right-wing think tank based in Washington, D.C., the state has the highest property tax rates. from the country.

The nearly 161,000 New Jerseyans who were approved for a senior freeze rebate in 2020, the last full year, received an average rebate of $1,192.

“I know in my office I continually hear people — especially seniors — complaining about their property taxes, how high they are,” Turner said.

The Turner and Gopal bills would apply tax credits directly to third and fourth quarter property tax bills equally and still require residents to apply to receive a reward.

The measure would also require the director of the Division of Taxation to delay the application deadline for residents who have not filed due to medical issues.

It is unclear how much the transition to a tax credit would cost the state. The Office of Legislative Services has not attached any tax notes to either bill.

The office drafted a tax note for a version of Gopal’s bill introduced in the previous legislative session, but was unable to predict its impact on state finances in previous sessions, noting only that it would likely reduce the administrative costs associated with postage reimbursements.

Along the road

Transforming the senior freeze program has been a longtime goal for Turner, who first introduced a version of his bill nearly a decade ago, in 2013.

But earlier versions almost everywhere failed to advance to a committee hearing.

A version of the bill Turner and Senator Fred Madden (D-Gloucester) sponsored in the 2018-19 legislative session was unanimously advanced by the Senate Community and Urban Affairs Committee, but stalled after being referred to the committee room budget.

“That’s where all the bills are going to die, in the budget,” she said.

But the senator said she hoped the measure would evolve during the current session because “apparently someone thinks it deserves to be passed”.

Although the bills are set to go through the Senate Community and Urban Affairs Committee on Thursday – where Sen. Troy Singleton, chairman of the committee, said the two bills would be combined through a committee replacement – ​​the fate of their Assembly counterparts is less clear.

Neither the Assembly’s Committee on Aging and Senior Services, where the Republican-sponsored Assembly counterpart to Turner’s bill was fired, nor the Committee on Local and State Government of The House, which is expected to hear a version of Gopal’s bill sponsored by House Democrats, only had hearings scheduled as of Wednesday afternoon.

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