What is the Senior Tax Credit?
What is the Senior Tax Credit? How do you know if you qualify for it and what are the tax benefits?
Updated on Feb 05 2020
Tax season is upon us, and with it always comes a great deal of confusion and financial anxiety. And, this anxiety can be felt even more so when you’ve already retired and have begun living on a more fixed budget or income. Because of this, you’ll want to do everything you can to save on your taxes. Thankfully, there are some strategies specifically for senior taxes. Of course, the best strategy is to find a financial advisor who can help you minimize what you owe. This way, they can offer you expert advice. And, they can help you determine your eligibility for the Elderly and Disabled Tax Credit, also known as the Senior Tax Credit. While this credit can offer great tax relief, it can only do so for those who meet the specific criteria. Read on to learn if you qualify for the Senior Tax Credit.
How can the Senior Tax Credit help me?
The Senior Tax Credit can be a huge difference-maker for many older Americans when tax season rolls around. If you qualify, you could end up owing far less in taxes this season. But, this strategy is only applicable if you anticipate owing money to the IRS. If you’re anticipating a return, the Senior Tax Credit would likely not be a valid option for you. If not, this is surely an avenue worth exploring.
Do I qualify for the Senior Tax Credit?
The first requirement to qualify for the Senior Tax Credit is to be a U.S. citizen. Additionally, you must be age 65 by the end of the year you’re filing taxes for. If you aren’t yet 65 years old, you still have options. If you’re under 65, but the following three statements are true, you may still qualify:
- Prior to the end of the year in which you’re filing, you had retired on disability and it was determined you were completely disabled at the start of your retirement.
- During the year in which you’re filing, you received taxable disability income.
- Both prior statements are true, however you will also not have reached age 65 by January 1st of the next year.
If your situation fits these criteria, you may be able to qualify for the Senior Tax Credit. And, it’s always worth exploring options that could end up saving you on your taxes. So, you should consult a qualified advisor to make sure that you aren’t missing out on any potential savings.
However, there are still further qualifications towards receiving the Senior Tax Credit. Your filing status and income level will play a factor in your qualification. If your income is too high, you will not be able to qualify for the Senior Tax Credit. For example, if you are filing as “single,” your adjusted gross income cannot exceed $17,500. Additionally, if you are married filing jointly, and both spouses have qualified for the Senior Tax Credit, your adjusted gross income cannot exceed $25,000.
You could be a good candidate for the Senior Tax Credit if you fit within any of these criteria. To be sure, contact your financial advisor to talk about your options. Tax season can always be difficult. But, you can make things a bit easier on yourself by exploring every option available to you.
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