Washington - The U.S. Senate extended a property tax relief law originally authored by U.S. Senator Robert Menendez (D-NJ). Taxpayer homeowners who do not itemize deductions - many of whom are fixed income seniors - would receive an additional tax deduction of up to $1,000 for local property taxes. This tax deduction is currently in place for 2009, and under the extension, it will now apply to 2010 taxes as well.
"Local property taxes are a major squeeze on household budgets in New Jersey, which is why I am working to bring as much relief as possible from the federal level," said Menendez. "In writing this law, I focused on a group of homeowners that have a particularly tough time keeping up with rising property taxes. Extending the tax deduction by another year is critical in these tough times.
Under the law, single-filing property taxpayers who do not itemize will be able to take an additional standard deduction of up to $500 and joint filers will be able to deduct up to $1,000 for state and local property taxes paid. According to the Congressional Research Service, approximately 400,000 New Jersey residents will benefit from the initiative. Nationwide, there are 75 million owner-occupied households, but only 38 million of those taxpayers claimed an itemized deduction for real estate property taxes.