More than two decades ago, the state’s elected leaders had a good idea to help senior citizens, who mostly are on fixed incomes and therefore suffer more from endlessly rising taxes. They allowed seniors to stop their property taxes from increasing when they reached age 65 (or were disabled). Since New Jersey has some of the highest property taxes in the nation, that was one major living expense that wouldn’t keep rising.
But later when state leaders couldn’t find enough revenue to keep up with their spending increases, they started reducing this tax relief for seniors and the disabled. Ironically, they did it by freezing eligibility for what’s popularly called the “senior freeze program.” The maximum income to qualify for the tax relief was supposed to be increased by the cost of living each year, but for the past 10 years governors and legislators from both parties have kept the income cutoff at $70,000 for a couple.
If the eligibility ceiling had risen as the Property Tax Reimbursement law had specified, for the 2018 tax year couples with income up to $89,013 would qualify for the senior freeze, according to NJ Spotlight.
Now there is hope that this short-changing of seniors will be addressed. Assemblyman John Burzichelli, D-Cumberland, Gloucester, Salem and vice chair of the Assembly Budget Committee, pressed state Treasurer Elizabeth Maher Muoio to consider “bringing the program up to statutory income,” in light of the talk lately about people leaving the state and taxes being a factor. Muoio said the Murphy administration was willing to listen if the Legislature wanted to do so, noting that it would cost more than the governor planned. The Treasury later said it would reduce revenue by $16 million in Murphy’s proposed $38.6 billion budget.
Murphy called his budget proposal “A Blueprint for the Middle Class” in which he would use fiscal policy to help those earning middle incomes. Yet since it keeps the lower ceiling for the senior freeze, the elderly and the disabled with the state’s median household income of $76,475 are excluded from the property tax relief enacted in 1997.
Murphy’s budget does include other tax relief he started last year for homeowners paying more than $10,000 a year in property taxes. They would continue to be able to deduct up to $15,000 in such tax, which would reduce state revenue by $35 million.
Even fully restoring eligibility for senior freeze tax relief would cost less than 1 percent of the state budget currently being negotiated in Trenton. That’s a small price for Murphy and legislators to show they’re serious about helping the middle class, senior citizens and the disabled.