Round Two: Circuit Breaker Tax Credit vs. “Job Creation” Tax Credits?
Posted on July 23, 2011 by Megan Burke
If you thought we wouldn’t have to fight to save the Circuit Breaker tax credit for low-income renters until next year, you were wrong as was I. Maybe it was wishful thinking.
Governor Nixon and legislative leadership announced that there will be a special session in September to vote on a “job creation bill”. This bill addresses various tax credits. For example, the bill will create upto $360 million in tax credits for the “Aerotropolis” freight hub at Lambert-St. Louis International Airport, local sales and tax exemptions to attract large data storage facilities, and up to $10 million annually in tax credits to attract sporting events to the state. Similar to the bill brought forth during the legislative session, this bill will also discontinue the Circuit Breaker Tax Credit for low-income renters.
Low-income Missourians with disabilities and seniors depend on this tax credit every year to help pay for rent, medications, utilities, medical supplies, durable medical equipment, etc. It was intended to provide relief for property taxes. Both home owners (who pay property taxes directly) and renters (who pay property taxes indirectly in their rent) are eligible for the Circuit Breaker Tax Credit.
Seniors and individuals with a 100 percent disability are eligible for the Circuit Breaker Tax Credit. There income must be less than $30,000 for an individual/ $34,000 for married couples who are homeowners; and $27,500 for an individual/ $29,500 for married couples who are renters.
As of May 4th, a total of 197,415 Property Tax Credit refunds have been distributed for 2010. Of that, 95,685 have gone to renters.The total dollar amount distributed so far is $103,073,073. Of that total, $50,161,492 went to renters (maximum credit being $750). The Circuit Breaker Tax Credit has helped 70,281 people with disabilities, 123,645 seniors, 1,586 disabled veterans, and 1,903 widows/widowers (renters and home owners).
The Tax Credit Review Commission recommended further study before making changes to the Circuit Breaker. They should do the study prior to eliminating the Circuit Breaker for renters. While $750 does not seem like much to some, it is significant when a person has limited income with large utility or medical bills to pay. This bill makes it seem as though we are robbing the poor to pay the rich. Is that a Missouri value?
We want to hear from renters who have received the Circuit Breaker tax credit in the past. Your stories or those of people you know will help to draw a picture of why Circuit Breaker is so important. If you or someone you know has benefited from the Circuit Breaker tax credit, contact Megan Burke at 314-289-4277 or mburke@paraquad.org.
The law has not passed, so there is still time to save the program.
Learn more about more about the importance of the Circuit Breaker tax credit here.