Latest news with #LD1541
Newsweek
5 days ago
- Business
- Newsweek
Property Taxes Could Be Scrapped for Senior Citizens in Maine
Based on facts, either observed and verified firsthand by the reporter, or reported and verified from knowledgeable sources. Newsweek AI is in beta. Translations may contain inaccuracies—please refer to the original content. Property taxes could be completely scrapped for homeowners aged 65 and older in Maine if a proposal pushed forward by Senate Republicans is passed by the state House. LD 1541, which was referred to the state's Committee on Taxation in early April, would offer significant financial relief to longtime retirees who have lived in Maine for 10 or more consecutive years and have been hit hard by recent property tax increases. Why It Matters Maine's proposal to eliminate property taxes is just one of many currently moving through the legislatures of several states across the country. With home values skyrocketing in recent years as a result of the pandemic homebuying frenzy and a nationwide inventory shortage, property tax bills have also gone through the roof, fueling resentment and frustration against this type of taxation. The issue is particularly pressing when it comes to older homeowners, who are often on a fixed income and risk being priced out of their own homes as housing costs, including property tax bills, rise. What To Know Property tax rates in Maine, at an average of 1.17 percent, are well above the national average of 0.9 percent, according to SmartAssets, with the typical Maine residents paying $2,855 a year in bills. Property taxes have risen in step with home values, which have exploded in the state in recent years. In April 2020, the median sale price of a home in Maine was $239,000, according to Redfin, up 12 percent from a year earlier; in April 2025, it was $403,200, up 8.8 percent from a year earlier. The growing cost of housing is impacting older homeowners the hardest, especially as their property tax bills may now be even higher than their mortgage payments, if they still have any. A general view of a residential district in Portland, Maine. A general view of a residential district in Portland, Maine. Getty Images LD 1541 would eliminate property taxes for longtime senior residents in Maine, while the state government would reimburse local government for the lost revenues, which they use to fund public services like libraries, schools, and firefighting. Crucially, the bill does not include details of how much abolishing property taxes would cost the state. Maine already offers property tax credits to older homeowners, giving them the chance to receive a portion of the property tax paid during the tax year on the Maine individual income tax return whether they owe the state income tax or not. The state also offers a property tax deferral program which covers the payment of annual property tax bills for seniors who cannot afford to pay them on their own. Lawmakers in Maine have already tried to offer property tax relief to seniors in the state under a 2022 program that would have frozen bills for eligible residents so they wouldn't increase year to year with home values. The initiative, however, was repealed after 11 months due to its high cost, after the state spent $26 million on it. Newsweek contacted Maine GOP Senator Joseph Martin, who sponsored LD 1541, for comment by email on Tuesday, but has so far received no response. What People Are Saying Maine House Minority Leader Billy Bob Faulkingham, a Republican, recently told WGME: "We have an aging population, and a lot of people on lower income in that age range, and it's just an incredibly unfair burden to put on them." He added: "I think our seniors are a worthy expense, and keeping them in their homes is very important." Maine Center for Economic Policy state and local tax policy analyst Maura Pillsbury told WGME: "This could end up increasing property taxes for other folks in the community. This could put municipalities in a position where they can't fund local services and education." State Senate President Mattie Daughtry, a Democrat, said in a statement shared by WGME: "I myself have a property tax relief bill that seeks to address part of these concerns. We know Mainers are struggling. It's important to have a wide range of ideas, and I'm looking forward to having these bills go through committee and holding meaningful discussions on what's best for Maine people." What Happens Next The bill is going through the Maine legislature and would need to be passed by the state House to move forward. But many have questions over how Maine would cover for lost revenues and who would eventually shoulder the additional financial burden no longer carried by senior residents. Younger Mainers might end up shouldering the weight of property taxes, especially considering that the Pine Tree State's population is the oldest in the nation, with nearly a quarter of its population over the age of 65, according to a 2024 report by the State Economist of Maine. This could further exacerbate the challenges facing first-time homebuyers in the state, who are struggling to get on the property ladder because of historically high mortgage rates, rising prices and growing housing costs.
New York Post
01-05-2025
- Business
- New York Post
Seniors could get a tax break in this state — at younger people's expense
Maine Republicans are pursuing a bill that would eliminate property taxes for longtime senior residents. The move could bring financial relief to retirees—but it also raises serious questions about who will cover the cost. The Pine Tree State ranks 17th in the nation for effective property tax rates, according to the Tax Foundation. It's a middling position on paper that can hit especially hard for seniors on fixed incomes. 'We have an aging population, and a lot of people on lower income in that age range, and it's just an incredibly unfair burden to put on them,' House Minority Leader Billy Bob Faulkingham (R-Winter Harbor) told WGME. But property taxes are the lifeblood of local government, and if seniors are removed from the tax rolls entirely, younger Mainers could be left footing the bill. 6 Maine Republicans are pursuing a bill that would eliminate property taxes for longtime senior residents, which could bring relief for those with fixed incomes. Getty Images What's in the proposal? LD 1541 would eliminate property taxes for Maine residents aged 65 and older who have lived in the state for 10 or more consecutive years. The state government would then be responsible for reimbursing local governments for the lost revenue. It's just one of several proposals across the country this year to abolish property taxes, which are pinching homeowners of all ages as home values remain elevated and push up tax bills, but it's unique in its focus on seniors. 6 The proposal would eliminate property taxes for Maine residents aged 65 and older who have lived in the state for 10 or more consecutive years. Universal Images Group via Getty Images For context, the median home in Maine cost just $249,000 in January 2020. Today, it's nearly doubled, to $462,500. That's pushed the state's median annual property tax bill to $4,223, according to data. For younger homeowners, that jump in equity can be a financial asset. But for retirees, the resulting spike in property taxes can become a serious burden. The Pine Tree State isn't alone in this. Nationally, tax burdens are driving older Americans to leave high-tax states in search of more affordable places to age in place. Maine's proposal could help stop that outmigration by allowing longtime residents to stay in their homes. But the bill's financial impact on the rest of the state remains a major question mark. 6 While the plan could help keep longtime residents in Maine, it raises concerns over who will cover the costs. Getty Images/iStockphoto LD 1541 does not yet include a fiscal note—an official estimate of what it would cost—and Faulkingham has acknowledged that he doesn't yet have a firm projection. Still, past efforts and Maine's demographics suggest the cost could be staggering. A similar, doomed program This isn't the first time Maine has tried to provide property tax relief to seniors in the state. A 2022 program froze qualifying seniors' property tax bills so they wouldn't increase year to year as home prices also rose. 6 A 2022 program froze qualifying seniors' property tax bills so they wouldn't increase year to year as home prices also rose, and was later repealed 11 months after enactment due to its cost. Getty Images/iStockphoto That initiative cost the state $26 million and was repealed just 11 months after enactment due to its cost. In addition to the price tag, critics of the freeze also pointed to loopholes that made it possible for well-off homeowners to apply the homestead exemption to their luxury homes. It's unclear if similar workarounds would be possible in LD 1541. Keep in mind, the 2020 initiative simply froze effective rates—meaning that seniors were still responsible for paying some property taxes. The new proposal would eliminate them entirely, threatening a shortfall that could have severe consequences for the rest of the state. 6 The new proposal would eliminate property taxes for seniors entirely, impacting the rest of the state. The Washington Post via Getty Images Who will pay the difference? Part of the difficulty in Maine might be related to the simple fact that it's home to so many seniors. When measured by median age, Maine is the oldest state in the nation, and nearly a quarter of its population is over the age of 65, according to a 2024 report by the State Economist of Maine. Nationally, nearly 80% of seniors are homeowners and boomers (those aged between 61 and 79) hold $84 trillion in real estate wealth. Assuming Maine seniors mirror these trends, local governments could lose a substantial portion of their revenue. 6 According to the State Economist of Maine in 2024, it is the oldest state in the nation, with nearly 25% of its population being over the age of 65. The Washington Post via Getty Images And if the state can't fully cover the shortfall, homeowners under the age of 65 might be left picking up the tab, shouldering higher property taxes in a housing market that's already unaffordable for many. An uncomfortable trade-off Proponents of LD 1541 see it as a lifeline for Maine's aging population—one that could help longtime residents stay in their homes despite rising costs. But with no fiscal analysis and few guardrails in place, others worry the proposal could shift the financial burden onto younger generations—especially in a state where nearly one in four residents is over 65. Without clarity on how the state would reimburse municipalities or offset the potential cost of this proposal, it's not just a question of whether Maine can afford to help seniors; it's a question of whether doing so might come at the expense of younger Mainers. As the bill moves forward, the challenge for lawmakers will be finding a way to support aging Mainers without undermining the financial future of the state they hope to keep calling home.
