California Tax Tricks for Seniors | Estate Plan Pros
California Tax Tricks for Seniors

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Looking for property and income tax breaks?  California has a few options for seniors that could keep money in your pocket.

Property Tax Deferrals

While not eliminating property taxes, seniors 62 and older or disabled individuals with an annual household income of $35,500 or less can apply for postponement of property taxes on their home.  Information and the application are posted on the State Controller's website.

Examine Parcel Taxes

Many cities and counties have additional locally imposed taxes paid by parcel taxes.  The tax is based on the characteristics of the parcel, for example the size of the home or the lot.  However there are exemptions for which you may be eligible. 

To find out if you qualify for an exemption, call the local district or agency that imposed the parcel tax or special assessment listed on your annual property tax bill.

Note: An unofficial county-by-county list of some parcel taxes and exemptions is available on the California Tax Foundation website.

Moving? Take Your Property Tax With You

If you plan on buying a new home of equal or lesser value, and are 55 or older, you may be eligible to transfer your current property tax bill to your new home, thereby avoiding paying higher property taxes.  Read a full description about the benefits of Propositions 60 and 90 here.

Disabled Veterans May Qualify for a Property Tax Exemption

If you are a 100% disabled veteran, or an unmarried surviving spouse of one, you may qualify for a property tax exemption of $124,932 to $187,399 on your principal residence.

To learn more, visit the Board of Equalization’s disabled veterans' exemption webpage.

To apply for the Disabled Veterans' Exemption, contact your County Assessor.

Sales and Income Tax

for all taxpayers 60 years of age and older The Tax Counseling for the Elderly (TCE) program offers free income tax help.  They specialize in pensions and retirement-related issues.

To locate the nearest TCE site, use the Internal Revenue Service's site locator tool or call 1-800-906-9887.  Visit the IRS website for more information about TCE.

This year the BOE estimates seniors 65 years or older will save between $109 (single) and $218 (married) when filing their 2015 California income tax returns if they qualify for the Senior Income Tax Exemption Credit.

Another exemption, the Senior Head of Household Credit may save you up to $1,317 if you:

  • Are 65 or older as of January 1, 2016, and
  • Earned $69,902 or less in 2015, and
  • Filed as head of household in either of the previous two years.

There are also a number of items that are exempt from sales tax, like

  • Prescription medications
  • Prescribed medical equipment like wheelchairs, eyeglasses, crutches, canes, and walkers
  • Meals sold to low-income senior by a nonprofit organization or government agency, like Meals on Wheels Association of America
  • Meals served to you on a regular basis if you are 62 or older and live in a condo, and own equal share in a common kitchen facility. 

Source: Tax Help for California Seniors, California Board of Equalization

 

Tags:Taxes Seniors

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Erik Hartstrom

Erik is the founder of Estate Plan Pros, a leading estate planning practice in Elk Grove.  Erik’s practice focuses on Estate Planning Law. In Estate Planning, Erik works with clients to make the process simple, so clients can focus on more important things. He is a local authority for specialized estate planning instruments, like Special Needs Trust, Irrevocable Trusts, or other focused documents. Erik has litigated, negotiated, and mediated the gamut of family law cases. With this unique perspective as a family law and estate attorney he can often spot issues otherwise overlooked. Prior to graduating he worked as a legislative analyst for a non-profit organization, and volunteered as a youth counselor. Erik currently participates in local politics and is an active member of his local church. Erik is very happily married and has two young sons. Together, his family loves to get outdoors and enjoy the varied activities the Sacramento region has to offer.


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