2006 Income Threshold Amounts for Renters and Homeowners
A Massachusetts taxpayer age 65 or older that owns or rents his or her principal residence is eligible for the circuit breaker credit if he or she meet certain requirements.
For purposes of calculating the circuit breaker credit, total income, and maximum credit thresholds are adjusted annually to reflect inflation for the calendar year in which the taxable year begins.
For tax year 2006, the taxpayer’s “total income” cannot exceed $46,000 for a single individual who is not the head of a household, $58,000 for a head of household, and $70,000 for a husband and wife filing a joint return.
2006 Assessed Valuation Threshold Amount for Homeowners:
For tax year 2006, the assessed valuation, before the residential exemptions but after abatements, of the homeowner’s principal residence may not exceed $684,000. If the taxpayer owns more than one acre of land, only the assessed value of the principal residence, together with the land that immediately surrounds and is associated with that residence, not to exceed one acre, should be used in determining the eligibility of the taxpayer for the credit.
Calculation of the Credit Available in 2006
A. Renters
The credit is equal to the amount by which 25% of the rent actually paid by the taxpayer during the taxable year for the occupancy of the principal residence exceeds 10% of the taxpayer’s total income for the taxable year, provided that such amount does not exceed the maximum credit amount. For tax year 2006, the maximum credit amount is $870.
B. Homeowners
The credit is equal to the amount by which the taxpayer’s property tax payments in the current tax year, including water and sewer use charges paid to a municipality, but excluding any abatement or exemption granted, exceeds 10% of the taxpayer’s total income, for the taxable year, provided that such amount does not exceed the maximum credit amount. For tax year 2006, the maximum credit amount is $870.
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