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Volume 10 - Opinions of Counsel SBRPS No. 8

Opinions of Counsel index

Senior citizens exemption (income requirement) (circuit breaker) - Real Property Tax Law, § 467; Tax Law, § 606(e):

Moneys received by a senior citizen from the State Circuit Breaker Program are not income for purposes of the senior citizens real property tax exemption.

We have been asked whether money received pursuant to the Circuit Breaker Program should be considered income for purposes of the Senior Citizens Exemption (Real Property Tax Law, § 467).

The Circuit Breaker Program, established pursuant to section 606(e) of the Tax Law, provides a credit against the State income tax to taxpayers whose real property taxes exceed a specified portion of their “household gross income.” If a taxpayer’s credit exceeds his or her State income tax liability in any year, the excess is paid to the taxpayer (Tax Law, § 606(e)(2)). {1}

It would appear that such payments may be analogized to payments made under various public assistance programs, such as the federal Supplemental Security Income program. In a prior Opinion (4 Op.Counsel SBEA No. 72), we concluded that Supplemental Security Income benefits are a “gift” and not “income” for purposes of section 467. In that opinion, we state:

Apparently, the only requirements for eligibility for S.S.I. benefits are that the person(s) be either at least sixty-five years of age, or blind, or disabled, and that they have limited incomes and limited assets, in short, the only real qualification is need. There is no requirement that the individual (or any employer he might have) contribute to the program through deductions from his earnings; nor is there any requirement that the individual perform any service in return for such payments.

Similarly, here, refunds pursuant to the Circuit Breaker Program are payable solely on the basis of need. No contribution is required from the applicant, nor must he or she perform any services in return for such payment.

Accordingly, like S.S.I. payments and welfare payments, it is our opinion that payments made pursuant to the Circuit Breaker Program are in the nature of a “gift” and therefore excluded from the definition of income in paragraph (a) of subdivision 3 of section 467 of the Real Property Tax Law.

March 3, 1994

{1}  This question relates only to these payments that arise when the taxpayer’s Circuit Breaker credit exceeds his or her income tax liability. The portion of that credit that is used to offset the taxpayer’s income tax liability could not be considered income for purposes of the exemption, as it merely reduces one of the taxpayer’s expenses.