Special Benefits for Seniors
Getting older has its advantages when it comes to taxes. Different tax benefits kick in at different age milestones.
Here are some examples:
– The Internal Revenue Service considers a person to be age 65 the day before their 65th birthday. So those who turned 65 on January 1, 1997 are considered to have been 65 on December 31, 1996.
– Seniors 65 or older may not have to file a tax return if their income is less than a certain amount. For 1996, that amount for single seniors is $7,550. The limit for a married couple filing a joint return if both are seniors is $13,400.
– Those who don’t itemize deductions get a higher standard deduction than people under 65, and those who are blind get an added amount on top of that.
– Seniors or people with disabilities may qualify for the credit for the elderly and disabled. This credit is based on age, income, and filing status, and can reduce the amount of taxes owed. Those under 65 may be eligible if they retire with total and permanent disability and have income from their employer because of that disability.
– A once in a lifetime tax break is available to people 55 and older. Those selling their personal residence may qualify for an exclusion up to $125,000 of gain on the home sale. Certain use and ownership restrictions apply, and there are special rules for persons with disabilities and for widows or widowers.
Source: Internal Revenue Service and North American Precis Syndicate.