Massachusetts lawmakers recently enacted a $1 billion tax relief package that includes benefits for Marblehead residents, earning praise from state Rep. Jenny Armini and Sen. Brendan Crighton.
The relief targets families, renters, seniors and businesses with changes to credits, deductions and tax rates.
“Through changes to programs like the Child and Family Tax Credit and the Earned Income Tax Credit, we have created real savings for Massachusetts’ residents, which will benefit not just eligible families but our small businesses and local communities as well,” said Crighton, a Democrat from Lynn who represents Marblehead.
Armini, who lives in Marblehead, said the tax relief will help a lot of people in town.
“Marblehead has a reputation for being a wealthy community, but the reality is that a full third of Marblehead households are low-income, and two-thirds of those people are spending more than 30% on housing alone,” Armini explained.
More than 6,000 Marblehead residents are over the age of 60. The number of households led by someone 55 or older increased 21% from 2010 to 2017. Meanwhile, residents aged 25 to 44 decreased 63%.
The tax package doubles the so-called Senior Circuit Breaker tax credit from $1,200 to $2,400, indexed for inflation, helping 100,000 seniors statewide cover housing costs. Armini said many Marbleheaders want to age at home so the expanded credit will help make that possible.
“The Senior Circuit Breaker tax credit is an important tool for making that happen, especially with rising home values. I am proud that we doubled it from $1200 to $2400. If a senior’s property tax and water and sewer bills equal 10% of their income, they will get the Senior Circuit Breaker tax credit. That is real money,” Armini stated.
The new law also increases the property tax reduction limit from $1,500 to $2,000 for eligible senior volunteers, which could benefit Marblehead’s senior work-off program. The program allows senior taxpayers to volunteer their services to the town in exchange for a reduction in property taxes.
With high demand pricing many out of the housing market, renting is the only option for now, Armini said. The tax relief package increases the rental deduction cap from $3,000 to $4,000, providing 800,000 renters relief across the Commonwealth.
Armini noted the child tax credit increasing from $180 to $310 this year, and $440 in 2024, will benefit families, although she was hoping for more.
“The House originally proposed increasing the credit to $600 per child and dependent, but it was reduced during negotiations. I was disappointed because families could really use the additional $160 for food, clothes and school expenses. It’s important to remember that this money would go right back into the economy. These families don’t have the luxury of saving it. And that would be a win for our businesses and communities,” she elaborated.
For working poor with incomes below $57,000, the tax relief increases the state match on the federal Earned Income tax credit from 30% to 40%. The goal is to keep people working and gaining skills for better wages.
For a commuting town like Marblehead, Armini said allowing deductions for transit passes and bikes makes alternatives more affordable while reducing greenhouse gasses.
Overall, the localized mix of tax changes offers relief addressing the realities facing Marblehead – an aging population, inflationary pressures, housing costs and traffic, according to Armini.
“This tax bill is powerfully responsive to those dynamics — dynamics we see playing out in Marblehead,” she reiterated.
Material from the State House News Service was used in this article.