Tax Relief Information for People with Disabilities
People with disabilities and their families may be eligible for county, state, and/or federal tax relief.
- Real estate
- Personal property (car tax), and
- Rental grants.
Tax relief for all three categories may be granted to county residents who are permanently and totally disabled. In each case, there are income and net worth limitations that govern eligibility.
To obtain tax relief, an Application for Tax Relief must be completed. Persons or spouses applying for tax relief for the first time must provide certification and date disability began from one of the following:
- The Veterans Administration or Railroad Retirement Board
- An affidavit signed by two doctors who are either licensed to practice medicine in Virginia, or are military officers on active duty who practice medicine with the U.S. Armed Forces
- Certification by the Social Security Administration
In addition, comprehensive income and asset information along with documented proof must be provided. All of the required information is clearly listed on the application form. Applicants with disabilities may exclude the first $7,500 of the owner’s income for any of the three categories.
For the Real Estate Tax Exemption, the property must be owned by and occupied as the sole dwelling of the applicant. As of 2012, the gross income from all sources of the owner(s) of the dwelling and any relatives of the owner(s) who reside in the dwelling may not exceed $72,000. Income limitation and percentage of relief are:
Gross Income Amount of Tax Relief
$52,000 or less 100%
$52,001 – 62,000 50%
$62,001 – 72,000 25%
Up to $6,500 of a relative’s income may be excluded if the relative (other than the spouse) resides in the applicant’s dwelling. The total net assets of the applicant and of the spouse who reside in the applicant’s dwelling, excluding the value of the dwelling and up to one acre of land where it is situated, may not exceed $340,000. When the property is jointly owned and the co-owner is deceased, a certified copy of the death certificate is required.
For Personal Property (car tax) Tax Relief the gross income of the owners of the vehicle may not exceed $22,000. The net financial worth of the applicant and spouse who reside in the applicant’s dwelling may not exceed $75,000. Personal property tax relief may be granted on only one vehicle per household. Tax relief on mobile homes applies only to those mobile homes used as a residence. Note: The current (2012) car tax rate is $4.57 per $100 of assessed value. There is a special car tax rate involving a vehicle specially equipped or modified for persons with a physical disability, which is $0.01 (1 cent) per $100 of assessed value. Such vehicles must be certified by Fairfax County Department of Tax Administration.
For Rental Grants gross income from all sources of the persons
living in the dwelling may not exceed $22,000. Up to $6,500 of a
relative’s income may be excluded if the relative (other than the spouse)
resides in the applicant’s dwelling. Assets of the applicant and spouse
who live in the applicant’s dwelling may not exceed $75,000, and
applicants must pay 30% or more of their gross income toward the rent.
The amount of the grant is based on the rent paid in excess of 30% of the
Virginia has a Livable Home Tax Credit (LHTC) program designed to improve accessibility and universal visitability in Virginia’s residential units by providing state tax credits for the purchase of new units or retrofitting of existing housing units. Tax credits are available for up to $5,000 for the purchase/construction of a new accessible residence and up to 50% for the cost of retrofitting existing units, not to exceed $5,000.
To qualify for the purchase tax credit, the new unit must include the three features of universal visitability, or at least three accessibility features and meet the requirements of an existing accessibility standard. To qualify for the retrofitting tax credit, the unit must include at least one accessibility feature, lifts or elevators, and meet the requirement of an existing accessibility standard.
The three features of universal visitability are:
- At least one zero step entrance into the residence;
- An accessible bathroom on the same floor as the zero step entrance; and doors with at least 32 inches of clear width and hallways of at least 36 inches of clear width to the accessible bathroom and eating area.
- Other accessible features include: accessible light switches, electrical outlets and environmental controls; accessible kitchen facilities; lifts; elevators; sensory modifications.
Existing accessibility standards are those of the
Virginia Uniform Statewide Building Code; the American National Standards Institute
(ANSI); and the Uniform
Federal Accessibility Standard (Fair Housing Guidelines).
Federal Tax Relief programs are available for certain taxpayers with disabilities and or parents of children with disabilities. For example, taxpayers who are legally blind may be entitled to a higher Standard Deduction; certain disability related payments, Veterans Administration (VA) disability benefits, and Supplemental Security Income (SSI) are excluded in the computation of Gross Income; and medical expenses to include the cost of medical equipment may be eligible as itemized deductions. Because the specific tax relief applicable in any tax year can change, it is advisable to explore tax regulations for each tax year.
The Internal Revenue Service (IRS) publishes annually a host of publications. The most applicable IRS Publications for persons with a disability are:
- 501 – Exemptions, Standard Deductions and Filing Information;
- 502- Medical and Dental Expenses;
- 503- Child and Dependent Care Expenses;
- 524- Credit for the Elderly or Disabled;
- 525- Taxable and Nontaxable Income;
- 529- Miscellaneous Deductions;
- 554- Tax Guide for Seniors;
- 907-Tax Highlights for Persons with Disabilities
Additionally, there may be tax preparation help for qualifying individuals from the IRS-sponsored Tax Counseling for the Elderly Program (TCE) which provides free tax help for all persons with priority assistance to persons aged 60 and over. Trained volunteers from various non-profit organizations provide free tax counseling and basic income tax preparation for senior citizens. Also, the IRS Volunteer Income Tax Assistance (VITA) Program generally offers free tax help to people who make $50,000 or less and who need assistance in preparing their own tax return.