Judging by a variety of bills on the subject, Utah lawmakers recognize the urgent need for more property tax relief for retired people on low, fixed incomes.
Squeezed by utility costs, living expenses, and property taxes, many elderly people are increasingly hard-pressed to pay their taxes each year. Some are even threatened with the loss of their homes.The state already has a so-called "circuit breaker" program to provide tax relief for such persons. It has the electrical name because it is designed to kick in at certain levels of age and need. People can apply to county assessors for such help. Salt Lake County, for example, receives about 7,800 applications each year.
Unfortunately, like many other financial situations, the tax credits and qualifying income levels have been outmoded by time, inflation, and tax increases. Some people no longer qualify just because they have received very modest increases in pensions.
At present, persons with $10,000 or less annual income may apply and receive $25 to $100 worth of tax credits, depending on income. The state reimburses counties for the lost revenue. The total cost to the state is $1.2 million a year.
Four measures in the Legislature - three in the House and one in the Senate - seek a variety of solutions, including raising the amount of tax credit allowed, raising the qualifying income level, and lowering the age requirements or doing away with them altogether.
The first two alternatives both deserve serious consideration, but eliminating the age requirement could spread the program too far and cost the state too much. Circuit breaker help should be restricted to retired persons and the elderly. They are the ones most likely to be on limited incomes and the least able to cope with financial hardship.
Bills in the House would raise the minimum tax credit to $50 and double the state appropriation to $2.4 million to reach more people. A Senate measure would raise the income threshold to $15,999 and boost the maximum credit to $300 instead of the present $100.
Some combination of those two bills would be best, since both the minimum income and tax credit amounts are badly out of date and need to be modified.
The purpose of taxes is to support necessary government operations, not force the low-income elderly out of their homes simply because their fixed incomes can't keep up with tax inflation over the years.