Are You In Need Of Tax Relief?

Tax Relief Checks

Tax-relief checks are checks that the tax authorities mail to taxpayers as a means to lessen the tax burden. They can also be refund checks that are received from tax authorities for taxes paid in advance. After computing the tax assessment for the current assessment year or for the previous year, the tax authorities send any excess tax paid back to the taxpayer.

Tax-relief checks assumed prominence recently with the passing of the Economic Growth and Tax Relief Reconciliation Act of 2001, arguably the first major tax-relief program in the nation in the last two decades. The objective of the legislation is to reduce the burden on taxpayers by disbursing in advance tax-relief checks. The U.S. Treasury mailed checks for up to $300 for singles or $600 for couples in the summer of 2001, and the process is expected to be phased in over the coming years. Significantly, these tax-relief checks heralded the switch from the old 15 percent tax rate to the new 10 percent tax bracket. The objective here was to accord the highest priority to low- and moderate-income families by timely disbursal of the tax-relief checks based on the income tax burden.

The tax-relief legislation also has provisions to lighten the tax burden by allowing deductions for college tuition, student loan interest deductions, and tax benefits from government bonds that are issued specifically for constructing public school buildings. The fact that the relief checks are being sent as a refund to the taxpayers has drawn criticism from various sections of the population who believe that the money should have been directly used for education. Also, an important aspect of the tax-relief checks that has been brought to light is that these relief checks are not rebates or refunds from past overpaid taxes, but an advance on the refund for the future taxes to be filed.

Property Tax Relief

Property tax is a tax on real estate, boats, aircraft or other real property that is paid by the owner of such a property. The tax is determined on the basis of the value of the property. Property tax relief is a rebate or refund that the government provides to property owners who pay taxes on their property. This is a way to lighten the burden of tax on citizens.

Many states have passed legislation and introduced various measures to provide some form of property tax relief or the other to its residents. For example, California provides property tax relief to taxpayers who had their properties destroyed or damaged. This law is applicable to owners of real estate, business equipment, mobile homes, boats, and aircraft. Most items that are assessed property tax are eligible for the tax relief. In New Jersey, around 1.3 million residents benefited from increased property tax-relief checks that were mailed out in the summer of 2004, as part of the Fair and Immediate Relief plan. Checks of up to $1,200 were mailed to homeowners who were aged 65 or older and had a gross income of $100,000 or less. Tenants with gross income of $100,000 also stood to benefit from the tax rebate checks. The Homeowner Tax Relief Act of 2004, signed into law by Governor Rendell of Pennsylvania, proposed to provide property tax relief to Pennsylvania residents through income generated from gaming.

Typically, property tax relief is provided through various categories. Commonly used terms for categories are Homestead Exemption, Senior Citizen Real Property Tax Relief, First-Time Homebuyer Individual Income Tax Credit, Individual Income Property Tax Credit, and Low-Income, Long-Term Homeowners Tax Credit. The property tax relief helps all the residents by reducing the burden of the tax. It does so particularly in the case of senior citizens and low- and modest-income families.