The potential benefits of deferment programs for senior real estate tax
According to Alicia Munnell, senior adviser to the Center for Retirement Research at Boston College, is in a new OP-ED for Market watch.
“I have always been a big fan of thinking about the house as a pension assets and about ways in which people have access to the equity in their house to maintain themselves in retirement,” she wrote.
“The conventional approaches include contraction to a cheaper house, for which pensioners have to move or remove an inverted mortgage, so that people can stay in place but considerable complexity and costs for preceding the preceding.”
However, deferment programs for real estate tax are a “much better option” than one of these, she said.
Adam Scanlon, a legislator in the Massachusetts House of Representativeshas recently submitted a bill to the legislative power who wants to set up a pilot postponement program for the older homeowners of the State.
Although some places offer these programs, participation is good for only 702 residents from the tax year 2022, according to data cited by Munnell from several sources. This is due to three primary reasons, she appoints.
“First of all, most homeowners are not eligible,” said Munnell. “Secondly, eligible homeowners are not aware of the program (because only rich communities have announced their program) and often confuse it with other tax credit and exemption programs.
“Thirdly, homeowners who are eligible and are often aware, do not know how to register, are concerned about a stigma that is connected to an income tested, or hesitate to place a right of retention on their house.”
Under the new proposal in Massachusetts, postponing real estate tax would save an older homeowner up to $ 4,755 a year, she said. Delays can be chosen in various terms (monthly or annually), and the recording of the pilot can help determine a path for the rest of the state.
From 2023, 12 states offered postponement programs for real estate tax, according to a list composed by Moneytalksnews. But experts usually recommend that those who are considering entering such a program weighs the potential advantages and disadvantages, because postponement must be refunded at a later time.
Some states investigate an outright prohibition on real estate tax. Other local officials, who have removed concern from older residents about their real estate tax account, have also recommended the consideration of a reverse mortgage for those who are eligible.
