Property Tax and Rent Refund Program
Many of you are beginning to see the results of you new property evaluations. You as well as renters should make sure to take advantage of Maine’s “circuit breaker” program, which provides cash to help residents cover their property taxes. Qualified residents forfeit substantial sums of money by failing to apply for relief.
Property taxes are clearly one of the most pressing problems facing Maine homeowners. They also present economic difficulty for renters, because property tax liability is built into rental costs. There is help available, but you have to apply for it.
The state’s primary tax relief program is formally called the Property Tax and Rent Refund Program but is commonly known as the “circuit breaker.” It is run by Maine Revenue Services (MRS).
The deadline for filing applications for refunds on property taxes paid in 2005 was May 31, 2007. MRS estimates that approximately 200,000 Maine households qualify for the program. Last year, however, only 120,615 households applied and 93,915 qualified, receiving a total of $44.3 million. The maximum refund is $2,000. The deadline for taxes paid in 2006 will be May 31, 2008.
Thousands of Mainers who could have received refund checks did not even apply. There’s no good reason to forego a property tax rebate. The program exists to help people deal with high property taxes based on rising valuations. It is a very straightforward program in which taxpayer dollars are returned to taxpayers.
Under the guidelines, you may qualify for a refund if you do not have a spouse or dependents and your 2005 income was $77,000 or less. If you have a spouse and dependents, you could have made up to $102,000 in 2005 and still qualify.
There is one more hurdle. To receive a refund, your 2005 property tax must have exceeded 4 percent of your income. Renters qualify if the rent they paid in 2005 exceeded 20 percent of their income. It’s important to note that seniors do not have to meet those requirements when their household income is below $12,700 for those living alone or below $15,700 for those living with a spouse or dependent.
Some people fail to apply because they think they should not take this – that it’s welfare. It’s not. It is tax relief to which they are entitled.
MRS generally sends applications to anyone who filed in the previous year. Applications are also available at town offices, libraries, post offices and Area Agency on Aging and Community Action Program offices.
