Senior citizens exemption: Income requirements

You cannot receive the senior citizens exemption if the income of the owner, or the combined income of all the owners, exceeds the maximum income limit set by the locality.

If you are married, the income of your spouse must be included in the total unless your spouse is absent from the residence due to a legal separation or abandonment. The income of a non-resident former spouse, who retains an ownership interest after the divorce, is not included. If the "sliding-scale" option is in effect, you must meet that income limitation; contact the assessor to determine what the income limits are.

Income is to be reported on the basis of the latest preceding "income tax year" prior to the date of application. This usually is the preceding calendar year.

Proof of income

If a Federal or New York State income tax return was filed for any of the owners of the property or their spouses for the preceding year, copies of such return should be submitted with their application. You may also be required to submit statements of payments made by the Social Security Administration, bank statements, rent receipts or other documents to substantiate your statement of income.

Income includes

• all Social Security payments, salary and wages (including bonuses)
• interest (including nontaxable interest on state or local bonds)
• total dividends, net earning from farming, rentals, business or profession (including amounts claimed as depreciation for income tax purposes - see ORPTS Opinion of Counsel 5-30)
• income from estates or trusts
• gains from sales or exchanges
• the total amount received from governmental or private retirement or pension plans
• annuity payments (excluding amounts representing a return of capital)
• alimony
• unemployment insurance payments
• disability payments
• workers compensation
• Individual Retirement Account (IRA) contributions
• earnings on IRAs
• etc.

Income does not include

• Supplemental Security Income
• welfare payments
• gifts
• inheritances
• payments received as participants in the Federal Foster Grandparents Program
• a return of capital
• reparation payments received by Holocaust survivors
• distributions from IRAs

(For more information on IRAs and the senior citizens exemption, see our Opinion of Counsel.)

Municipalities have the option to permit seniors to subtract from their incomes all medical and prescription drug expenses that are not reimbursed or paid by insurance, as well as veterans disability payments.

If an owner is an inpatient in a residential health care facility, the owner's other income is not considered income in determining exemption eligibility if it does not exceed the amount paid by such owner, spouse or co-owner for care at the facility. Proof from the facility of the amount paid for an owner's care must be submitted with the application.

Proceeds of a reverse mortgage

Reverse mortgage proceeds should not be considered income for purposes of this exemption. However, when such proceeds are invested, any interest or dividends from such investment should be considered as income. Also, monies used to repay a reverse mortgage can't be deducted from income.

Department of Taxation and Finance

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