I know many of you don’t want to hear this, but it’s about that time of year again. Time to start thinking about end of year tax planning.
If you are retired or receiving Social Security benefits there are actually some things to be excited about as you project what you may owe for 2024. In July of 2023, bill MO SB 190 was signed into law by Governor Mike Parsons as an attempt to provide much-needed tax relief to Missouri seniors.
Going into effect on January 1 of this year, the law expands deductions for retirement and social security benefits and establishing property tax credits for eligible seniors.
Prior to this law, social security benefits were only fully deductible for Missourians 62 and older, whose adjusted gross income was less than $85,000, for single individuals, and $100,000 for married couples. Starting in 2024 these income caps have been eliminated and 100% of Social Security benefits received by all Missouri seniors are deductible from Missouri income tax, regardless of income or filing status. This means for many of you reading this, your overall state income tax bill is likely to go down this year.
In addition to providing income tax relief to Missouri seniors, this law also provides property tax credits for those who reside in counties that have adopted an ordinance authorizing such a credit, or a petition in support of such a credit that has been approved by the voters of that county.
Here in Jackson County, the law essentially freezes the property taxes owed on an individual’s primary residence by providing tax credits to offset any future increases. To qualify, the property owner must be 62 or older, a Jackson County Resident, and must be liable for the payment of property taxes on the home.
To receive this credit, Jackson County residents must complete and submit an application by year’s end. An application can be obtained by emailing the county at SeniorApplication@jacksongov.org or by visiting the Historic Truman Courthouse 112 W. Lexington Ave. Suite #114, in Independence.
If you live outside of Jackson County, the neighboring counties of Cass, Clay, and Platte all have similar laws in place. For more information about these credits, or the process for applying for them, you should contact your local government website or give them a call.
There is no doubt the past few years have been challenging economically for all of us, but it has been especially hard for seniors living on fixed incomes. These new tax cuts should serve as a welcome relief to many seniors hit especially hard by inflation. If you have questions about this law or how it may impact you, I recommend you discuss your personal situation with a tax professional. They are best equipped to ensure you receive the tax savings you are owed.
(Past performance is no guarantee of future results. The advice is general in nature and not intended for specific situations)