Tax Deferral and Recovery for Poverty or Financial Hardship (Clause 18A)

State

Massachusetts

Year

2022

Variations in Receipt of Benefit

Other Variation in Receipt of Benefits

Benefit Type

Deferral

Benefit

Individual deferral and recovery agreements may be established annually between the taxpayer and the local board of assessors when persons who by reason of age, infirmity and poverty, or financial hardship resulting from a change to an active military status other than initial enlistment are unable to contribute fully. The total amount of taxes due (including interest) shall not exceed 50% of the owner’s share of the property. The tax deferral and recovery agreement may not exceed 3 tax years and the total taxes due (including 8% interest charged annually or a lower rate established by local option) must be paid in 5 equal payments over 5 years. The first payment is due 2 years after the last day of the deferral. The local municipality will place a lien on the property for the amount of taxes owed plus interest and lien filing fees. This lien must be satisfied upon the sale or transfer of the property or the death of the applicant unless a surviving spouse also residing at the residence enters into a tax deferral and recovery agreement. Upon the sale of the property or the death of the applicant or surviving spouse, the interest rate on taxes owed will increase to 16%. Applicants must apply for the deferral annually by 1 April or 3 months after tax bills are mailed for the fiscal year. A state tax deferral and recovery agreement must accompany the initial application.

How is Benefit Disbursed

Other

Eligible Property Type

Residential

Characteristics of Eligible Property

Only residential property owned by qualifying individuals is eligible for this incentive.

Eligibility Criteria

Active Military

Age

Disability

Homeowner

Principal Residence

Veteran

Surviving Spouse

Other Criteria

Description of Eligibility Criteria

An applicant is eligible for a deferral if they are unable to pay their property taxes by reason of age, infirmity and poverty, or financial hardship resulting from a change to active military status other than initial enlistment. They must have been a state resident for the prior 10 years.

Local Option in Adoption of Program

Local government is unable to exercise an option

Local Option Regarding Program Features

Local option regarding program features

State Funding for Local Tax Loss

Local government covers all of its tax loss

Record ID

MA102_RR22

Footnotes

The property may not be sold or transferred unless the taxes have been paid with interest. Upon the death of the property owner, legal heirs have priority to the property provided that they pay all back taxes and interest in full. If the heir is a surviving spouse, the spouse may enter into a tax deferral and recovery agreement with the board of assessors.

Sources

Mass. Gen. Laws ch. 59, §5-18A (in effect for 2022)
Massachusetts Department of Revenue, Application for Property Tax Deferral for Reasons of Financial Hardship, Form 99 (November 2016)
[https://www.mass.gov/doc/form-99-application-for-clause-18a-financial-hardship-property-tax-deferral/download Accessed 11/14/2023]
View Archived Source

Massachusetts Department of Revenue, Tax Deferral and Recovery Agreement, Form 99-1 (April 2004)
[https://www.mass.gov/doc/form-99-1-application-for-clause-18a-tax-deferral-and-recovery-agreement/download Accessed 11/14/2023]
View Archived Source
Massachusetts Department of Revenue, Property Tax Forms and Guides
[https://www.mass.gov/lists/property-tax-forms-and-guides Accessed 11/14/2023]
View Archived Source

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