Today, during a visit to Lowell Elder Care Services, Congresswoman Niki Tsongas called on the federal government to ease the tax burden for senior citizen volunteers in Massachusetts. To that end, Tsongas today announced she will introduce the Senior and Retired Volunteers Act (SERV Act), legislation that provides targeted federal tax relief to senior citizens participating in Massachusetts' local volunteer programs, while also relieving local communities from bureaucratic burdens around that volunteer work.
Currently, Massachusetts state law allows towns to choose to forgive up to $1,000 in property taxes for senior citizens who work a certain number of community service hours. However, the Internal Revenue Service (IRS) counts this benefit as taxable income, requiring seniors to pay for helping out in their community. Towns are then required to go through a lengthy paperwork process and as a result, too many communities choose not to offer the incentive at all.
In just one example of many, in February the Groton Board of Selectmen grappled with these very concerns as they weighed their ability to participate in the state's program, denying seniors the opportunity to benefit from it.
The SERV Act would waive the property tax benefit from counting for federal tax purposes, providing tax relief for seniors who want to give back to their communities and, just as important, relieving towns from the burdens of unnecessary paperwork.
"I first learned about this issue from senior volunteers and communities I represent that wanted to participate in the state program but couldn't due to the administrative burdens created by the IRS. I am proud to support this simple fix which will allow our communities to benefit from the talents of an even greater pool of volunteers who want to give back," said Congresswoman Tsongas. "I look forward to working with the communities of the Third District and my colleagues in Congress to move this legislation ahead. We have a responsibility to support those who serve their communities and the SERV Act will do just that."
"This bill is an obvious win-win for cities and seniors. Volunteering speaks to healthy living and healthy aging," said Rosanne DiStefano, Executive Director of Elder Services of the Merrimack Valley. "This effort will encourage more seniors to remain active and use what they can to help others, in addition to removing the red tape that will allow more cities to participate in the benefit program."
Congressman Richard E. Neal (MA-1) is an original cosponsor of this bill, a similar version of which had been introduced by former Congressman Barney Frank in the last Congress.
"Senior citizens in Massachusetts who volunteer their time should not be penalized by the IRS for their benevolence and generosity. I simply don't believe our elderly, many of whom are on fixed incomes, should pay income tax when they are trying to give something back to their communities. This is no way to reward those golden agers who want to spend their retirement being active and productive. In my opinion, under these circumstances, property tax abatement should not be considered income," said Congressman Neal, senior member of the House Ways and Means Committee.