Winsted Gives Seniors Options for Tax Breaks


 

WINSTED — Seniors in town will soon have a greater range of options when it comes to property tax relief.

Currently, there are three programs available to Winsted seniors (age 65 and older) and totally disabled residents. The programs allow property taxes to be either frozen, deferred and/or reduced with state and municipal tax credits. Selectmen are in the process of seeking approval to increase the amount of taxes that can be deferred.

According to Janice McKie, tax assessor, qualified participants can have their taxes frozen for a two-year period. After two years they must reapply to the program.

For example, if a home is assessed at $100,000 with the current mill rate of 34.27, taxes for the year would be $3,427. Should the mill rate increase, participants in the tax freeze program would continue to pay $3,427 for two years.

To qualify for the tax freeze, residents are limited to $125,000 in combined assets, including all bank accounts, stocks, bonds, retirement accounts, other residents (excluding the primary resident in Winchester) and motor vehicles.

The state and municipal tax credit program is based on a sliding income scale and allows for a maximum of $1,250 for a married couple to be credited to a resident’s tax bill. A portion of the credit is paid by the state of Connecticut, with the town of Winchester providing the balance.

Using the same example as above, should taxes for the year total $3,427 and a resident qualify for the entire $1,250 credit, the balance payable by the owner would be $2,177.

The third program available to seniors and totally disabled residents is the tax deferral program. To date, only a handful of homeowners are taking advantage of the program, said McKie.

The tax deferral program works on the premise that 25 percent of the taxes due on the property will not be payable to the town, but will be collected when the property is sold or title is transferred to another family member or owner. An interest-free lien is placed on the property to ensure town reimbursement for back taxes.

"This program is especially attractive to those who wish to have more cash flow and be able to meet their living expenses or have extra money to invest for the future, travel or have a better quality of life," states townofwinchester.org. Certain income requirements must be met to qualify for this program and the town guarantees that enforcement of the unpaid taxes will not take place until the home is sold or transferred.

Selectmen are in the process of seeking approval to increase the tax deferral rate from 25 percent to 75 percent.

"There are certain procedures they need to do to get it approved," said McKie. However, she is confident that the proposal will pass and be in place soon.

"Usually people who are by themselves take [the tax deferral] if they don’t have anyone to pass the property to," said McKie.

McKie said qualifying residents can utilize any or all of the programs at one time to maximize the amount of tax relief.

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