Anaya Nolan
Circuit breaker tax laws are supported by 29 states and the District of Columbia, which offer property tax circuit breaker programs to low-income individuals and families. These programs are designed to reduce the property tax liability for those whose property tax payments represent a large portion of their income. In some states, property tax circuit breakers are only available to senior citizens and people with disabilities, while in others, they are available to families and individuals regardless of age or disability status. The diversity of circuit breaker models results in variation in states' fiscal contributions toward the programs.
| Characteristics | Values |
|---|---|
| Number of states that offer property tax circuit breaker programs | 29 states and the District of Columbia |
| Number of states that use programs to relieve the property tax burden for low-income individuals and families | 18 |
| Number of states that offer circuit breaker programs only to senior citizens and people with disabilities | 8 |
| Number of states that offer circuit breaker programs to families and individuals regardless of age or disability status | 10 |
| States where circuit breakers represent a small fraction of property taxes paid | Oklahoma, Oregon, and New York |
| States where circuit breakers represent over six percent of total property tax collections | Michigan, Minnesota, and Vermont |
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What You'll Learn
- Circuit breakers reduce property taxes
- Circuit breakers are a tax refund for low-income individuals and families
- Circuit breakers are available in 18 states
- Circuit breakers are available to senior citizens and people with disabilities in eight states
- Circuit breakers are available to families and individuals regardless of age or disability status in 10 states
Circuit breakers reduce property taxes
Currently, 29 states and the District of Columbia offer property tax circuit breaker programs. However, only 18 states use a wide scope of programs to relieve the property tax burden for low-income individuals and families. In eight of these states, property tax circuit breakers are available only to senior citizens and people with disabilities. In 10 other states, they are available to families and individuals regardless of age or disability status.
The most common form of help is a threshold-style circuit breaker. This type of circuit breaker utilises a specific threshold percentage that property taxes must exceed before any tax relief is available. With this type of circuit breaker, relief would be equal to the amount of property taxes paid above the threshold. There are single-threshold formulas where a single threshold is established to focus on tax relief, and there are also multiple-threshold formulas where the relief can be applied more progressively in an incremental fashion.
The diversity of circuit breaker models results in great variation in states' fiscal contributions toward the programs. In some states, property tax circuit breakers represent a small fraction of property taxes paid – less than 0.10 per cent in Oklahoma, Oregon and New York. In other states, such as Michigan, Minnesota and Vermont, circuit breakers represent over six per cent of total property tax collections.
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Circuit breakers are a tax refund for low-income individuals and families
In eight states, property tax circuit breakers are only available to senior citizens and people with disabilities. In 10 other states, they are available to families and individuals regardless of age or disability status. The most common form of help is a threshold-style circuit breaker, which utilises a specific threshold percentage that property taxes must exceed before any tax relief is available. With this type of circuit breaker, relief would be equal to the amount of property taxes paid above the threshold.
Circuit breakers are designed to prevent low-income households from being overloaded with tax burden, just as an electrical circuit breaker prevents an electric circuit from being overloaded with energy.
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Circuit breakers are available in 18 states
Circuit breakers are a tax refund given to low-income individuals and families whose property tax liability is a large percentage of their yearly income. They are designed to prevent low-income households from being overloaded with tax burden, just as an electrical circuit breaker prevents an electric circuit from being overloaded with energy.
The diversity of circuit breaker models results in great variation in states' fiscal contributions toward the programs. In some states, property tax circuit breakers represent a small fraction of property taxes paid, while in others, they represent over six percent of total property tax collections.
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Circuit breakers are available to senior citizens and people with disabilities in eight states
The most common form of help is a threshold-style circuit breaker, which utilises a specific threshold percentage that property taxes must exceed before any tax relief is available. With this type of circuit breaker, relief would be equal to the amount of property taxes paid above the threshold. There are single-threshold formulas where a single threshold is established to focus on tax relief, and there are also multiple-threshold formulas where the relief can be applied more progressively in an incremental fashion.
In total, 29 states and the District of Columbia offer property tax circuit breaker programs. The programs that the 18 states offer vary tremendously in scope and administration. In 10 other states, they are available to families and individuals regardless of age or disability status.
The diversity of circuit breaker models results in great variation in states' fiscal contributions toward the programs. In some states, property tax circuit breakers represent a small fraction of property taxes paid – less than 0.10 per cent in Oklahoma, Oregon and New York. In other states, such as Michigan, Minnesota and Vermont, circuit breakers represent over six per cent of total property tax collections.
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Circuit breakers are available to families and individuals regardless of age or disability status in 10 states
The most common form of help is a threshold-style circuit breaker, which utilises a specific threshold percentage that property taxes must exceed before any tax relief is available. With this type of circuit breaker, relief would be equal to the amount of property taxes paid above the threshold. There are single-threshold formulas where a single threshold is established to focus on tax relief, and there are also multiple-threshold formulas where the relief can be applied more progressively in an incremental fashion.
In some states, property tax circuit breakers represent a small fraction of property taxes paid – less than 0.10% in Oklahoma, Oregon and New York. In other states, such as Michigan, Minnesota and Vermont, circuit breakers represent over six per cent of total property tax collections.
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Frequently asked questions
A circuit breaker tax law is a tax refund given to low-income individuals and families whose property tax liability is a large percentage of their yearly income.
Circuit breaker tax laws are supported by the state governments of 18 states, including Michigan, Minnesota, Vermont, Oklahoma, Oregon and New York.
Eligibility varies by state, but generally, individuals and families who pay a high share of their income in property taxes are eligible for a refund. In eight states, circuit breakers are only available to senior citizens and people with disabilities.
The 18 states that offer circuit breaker tax programs deliver roughly $3 billion per year.
