Deb Miller, JD, volunteer with WV Senior Legal Aid
As Jean sat at her desk with her 2024 tax paperwork, she remembered the quote, “I believe we should all pay our taxes with a smile. I tried, but they wanted cash.”
It was her goal to file her federal and West Virginia income tax returns online as early as possible.
Jean had read about scammers who swoop in and file a fake return using the unsuspecting person’s name and other information to steal their refund.
Each year, the IRS flags millions of tax returns for potential fraud. That means each return is suspended from processing pending identity verification. The taxpayers are notified that they must complete extra steps before their tax return can be processed.
At age 74, Jean’s tax priorities were to see whether she qualified for the federal child care and earned income tax credits related to raising her grandson and the West Virginia income tax credits connected to owning her home and the property taxes she paid.
To claim any federal or state tax credit, Jean has to file tax returns, but does not have to itemize any deductions.
She knew the tax credits she was eligible for were like gold. Each dollar of a credit eliminates a dollar of tax (making a credit better than a deduction). Also, some types of tax credits can increase the amount of a refund when one is owed.
Federal law provides a child care tax credit for this type of expense related to working when earning certain levels of income and raising one or more children under age 13. Learn more at https://www.irs.gov/taxtopics/tc602.
The federal earned income tax credit also helps working grandparents who are raising grandchildren of qualifying ages. The amount is tied to the grandparent’s earnings from employment (not government benefits) and the number of dependents. More information is available at https://www.irs.gov/credits-deductions/individuals/earned-income-tax-credit.
On her West Virginia taxes, Jean (and other older or disabled homeowners) can benefit from income tax credits that are available based on home ownership and related property taxes.
As part of our state’s property tax system, the Homestead Exemption is available through the county assessor’s office for homeowners who are age 65 or older or are permanently disabled, regardless of income. The $20,000 exemption, or non-taxable amount, reduces the assessed value and total property taxes owed on owner-occupied residential property each year.
At income tax time, homeowners who previously qualified for the Homestead Exemption may be eligible for the Senior Citizens Tax Credit. The State Tax Department’s Form SCTC-1, sent out in January each year, will list the amount of the tax credit which can be claimed.
There is a specific income requirement for Senior Citizens Tax Credit eligibility which is determined when calculating the amounts for the West Virginia tax return.
Under WV Code §11-21-23, the Homestead Excess Property Tax Credit has no age restriction but does have an income limitation. The credit, up to $1,000, applies when a person’s or couple’s residential property taxes exceed 4% of their income.
Additional information on these West Virginia tax credits is available at https://tax.wv.gov/Individuals/SeniorCitizens/Pages/SeniorCitizensTaxCredit.aspx.
For free legal assistance with a non-criminal matter, West Virginia residents age 60 or older may contact West Virginia Senior Legal Aid at 800-229-5088 or info@seniorlegalaid.