How the New Jersey Senior Freeze is Making a Difference

Property taxes are defined as taxes that are collected by the local jurisdiction in which a real property is located; the amount of property taxes any homeowner owes is based on the assessed value of the home(s) they own multiplied by the current tax rate in their local jurisdiction. New Jersey’s average property tax rate is one of the highest in the United States.

Owning a home in the Garden State has a lot of benefits, and those of us who are living and raising a family here wouldn’t dream of doing it anywhere else. We may have to grit our teeth every time the quarterly tax bill makes its appearance, but pay it we do. Life in New Jersey is worth it – offering tight-knit neighborhoods, reputable public schools, and, of course, the Jersey Shore! However, as NJ homeowners reach retirement age, many have begun struggling to keep their homes, in many cases because they’ve fallen behind on their property taxes.

As New Jersey’s real estate market continues to take hits, lawmakers are now taking steps to help struggling seniors so they don’t have to leave the state in order to afford to own a home. The Property Tax Reimbursement Plan, commonly called the “Senior Freeze,” is one of the programs that is making a real difference.

Under the Senior Freeze, or the PTRP, New Jersey seniors who meet a list of requirements will be eligible for reimbursement of the cumulative increase in their property taxes since the first year they became eligible, which is called the base year.

In order to qualify for property tax increase reimbursement under the Senior Freeze program, New Jersey seniors:

  • Must have lived in New Jersey for at least ten consecutive years – either renting or owning their own home
  • Have resided in the home they currently own for a minimum of the last three consecutive years
  • Should be at least age 65 or have a spouse who is at least 65 year of age – ALTERNATIVELY – those who do not meet the age requirement but are receiving Federal SSDI (disability) benefit payments can also qualify
  • Must meet specific income requirements

The year in which New Jersey seniors are able to meet all of the above eligibility requirements is considered their base year. The base year is essentially the year in which their property taxes will be “frozen,” so to speak. Any increase in their NJ property taxes that they have paid out since the base year will be repaid to them.

Ex: Ruth turned 65 in the year 2010. She has lived in and owned her current New Jersey home with her husband for 20 years, and she also met all of the additional requirements in 2010. Ruth will be reimbursed using this formula: The property tax amount she paid in 2017 (current year) minus the amount she paid in property taxes in her base year (2010). The difference equals her reimbursement amount.

Every year forward, Ruth’s property taxes will remain frozen at the amount she paid in her base year of 2010. Combined with assistance from the Homestead Benefit Program, New Jersey senior citizens have a better chance at maintaining their standard of living into retirement, and they can continue to enjoy the wonderful Garden State for many years to come.

 

 

 

 

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Are You Committing Financial Child Abuse?

Although it may be something you’ve never considered, there have been many reports of what is now being called “financial child abuse.” One of the easiest ways to commit financial child abuse is to use your child’s Social Security number instead of your own.

Why would anyone use their child’s Social Security number?

Typically, the perpetrator has found himself with a significant amount of debt that may include wage garnishment. What this means is that any time the adult in question attempts to get a job, his debts follow him and his creditors will be able to take a portion of his paycheck.

Because of this, the adult decides to use his child’s Social Security number when applying for a new job. Oftentimes, the father and the child in question have the same name, making this kind of activity slightly more difficult to detect by law enforcement.

Is it a crime to use your child’s Social Security number?

Not only is it illegal, but to do so would be committing a number of serious crimes including:

  • Identity theft
  • Fraud
  • Tax fraud
  • Social Security fraud
  • Theft

These crimes will almost certainly prevent the adult in question from ever discharging any of his debts in a bankruptcy in the future, and in addition, he may face prison time and thousands of dollars in fines.

Why is it a crime? Who is it really hurting?

The reason it is a crime to use a child’s Social Security number to obtain employment or a loan, etc. is because regardless of whose Social Security number is being “borrowed,” it is illegal to do so. End of story. A Social Security number is not something that can be borrowed, shared, or changed.

It can affect the child in question by tacking on Social Security wages to his SSN that he may have to answer for later in life if the activity is not stopped and reversed. This can cause the child serious legal problems involving Social Security fraud, even though he had no knowledge of the crime being carried out.

What is a better solution to my debt-related problems?

It is always a good idea to avoid committing a crime in order to get out of paying your debts. The reasons? You’re going to end up getting in serious trouble, you may go to jail, you will owe more money in the end, you will cause conflict within your family, and most importantly: There is a better solution!

You can erase the debts that you have. You do not have to borrow someone else’s Social Security number to get around your creditors. It is understandable and admirable that you want to get a job to support your family. Just don’t resort to committing a crime that you will regret later in order to do so.

Filing for NJ bankruptcy will wipe out most or all of the debts that you have racked up (with some exclusions) – allowing you to have a relatively clean credit report and no debts that will be taken from your wages.

Will a bankruptcy appear on my credit report?

It is impossible to avoid a bankruptcy showing up on your credit history, however, taking the responsibility for your debts and doing the right thing is viewed much more favorably by employers and lenders. You will have a much easier time getting a job with a bankruptcy on your record than if you had been convicted of fraud and identity theft.

The bankruptcy will disappear off of your credit report within seven to ten years depending on which chapter you file. Committing a crime like identity theft or Social Security fraud will remain on your criminal history record for the rest of your life. Which sounds more desirable to you? Do the right thing – file for bankruptcy and get rid of your debts so that you can move forward with getting that job and supporting your family the right way.

Asset Planning for Seniors in New Jersey

Seniors today are remaining spry, exceedingly physically fit, and overtly healthier than our predecessors of decades and centuries past. Although extended life expectancies mean more time to make memories with family members and loved ones, they can also mean that your finances have the potential to expire before you do.

While you may have created an estate plan in your 30s or 40s, it is important to reevaluate the details and all components of that plan if/when you live so long that parts of your plan become null, void, irrelevant or outdated.

At Veitengruber Law, we can provide you with long-term planning guidance for all stages of your life. Even if your current estate plan (Last Will and Testament) was drafted by someone other than our firm, we are more than happy to help you protect your assets.

Medicaid rules are numerous and complex. As you approach age 65 (or if you are currently receiving SSDI and are younger than age 65), we will make sure that you understand all of the rules and eligibility requirements.

Medicaid is associated with something called the “five-year look back period,” which can often be confusing and problematic without the help of an experienced New Jersey asset protection attorney. Although we cannot predict the future (yet!), we do have extensive experience in all of the necessary legal areas that relate to the five-year look back period. These areas include: real estate law, foreclosure law, estate planning and credit repair.

You have undoubtedly worked for many years to support your family and to develop a savings/retirement plan that is very important to you. Whether or not your finances will be enough to support you with an extended life expectancy is something we can help you plan for.

As you age, you may need to address potential for long-term care. While this certainly isn’t something that anyone wishes to contemplate, the necessity for nursing home care is a reality as you age. This need may double if your spouse is also still living. We will help you estimate your potential longevity based on your family history and your individual health history in order to come up with the best plan to protect your assets in the event that long-term care is in your future.

If your original estate plan was completed several decades ago, you may need to revisit the designee for executor of your estate. It is possible that your original designee is no longer living, is in poor health, or is no longer part of your life due to divorce, relocation, death, or other circumstances.

In addition to reviewing your estate executor, we will help you to re-evaluate the beneficiaries named in your will. We will also help you assess all components of your estate plan (and determine if they need to be updated based on your current health and that of your spouse) including: your living will, advanced medical directive, power of attorney, your will and any trusts that you have set up.

To find out how we can protect your property and other assets from potential future events, sit down with our professional asset protection team today for a free consultation.

 

Image: “Application Denied” by GotCredit – licensed under CC by 2.0

Foreclosure in the Golden Years: A Real Problem in America

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The baby boomer generation has reached their golden years, and for millions of them, life isn’t quite what they had envisioned. In fact, many elderly Americans are finding themselves suddenly homeless and without a place to go. Their dire living situations have been brought about by several factors combining to create the “perfect storm.”

Over the past 20-30 years, many employers have been eliminating traditional retirement pensions. Many baby boomers simply didn’t save enough money on their own, or have outlived the savings they amassed. People are living longer, but they aren’t making and saving enough money to take care of themselves throughout their extended retirement period.

On top of outliving their savings, today’s older Americans have lived through the housing bubble which caused a recession second only in severity to The Great Depression era. Many elderly people ended up using their homes as a bank, which kept them afloat temporarily through refinances that allowed them to essentially take money from their home.

The result of all of this is nothing short of dire for a huge number of older and elderly Americans who should rightfully be able to retire but have to keep working into their 70s, 80s and 90s in order to keep their homes. All of the baby boomers who reverse mortgaged their homes (took out loans for much more than the value of their home in order to have some cash to meet their living expenses) are now facing lenders who want their money back. Unfortunately, these lenders aren’t taking no for an answer, and many banks refuse to negotiate with the elderly to stretch out their payments, because of the possibility that the debtor will pass away before repaying in full.

For the most part, baby boomers who took reverse mortgages on their homes figured they would just work a little longer to pay off a growing mortgage. However, as often happens in our later years, many people fall ill and are not physically or mentally able to continue working. Disability checks, VA benefits and even help from grown children is often just not enough money to hold on to homes with swelled mortgages that resulted in sky high monthly payments.

What that means for many older Americans is falling behind on the mortgage payments, which leads to them eventually facing foreclosure. The thought of being evicted from your home in your golden years is unfathomable to us here at Veitengruber Law. We want older Americans living in New Jersey to know that they have options, and that we are here to help.

Lenders may not want to negotiate with elderly Americans, but that doesn’t mean there’s no hope. By law, no lender can discriminate against a debtor because of his/her age. Simply choosing not to work with elderly borrowers BECAUSE they are older and may not have a lot of years left, is irresponsible and illegal.

Working with our team at Veitengruber Law means that you will no longer have to deal with discriminating lenders – WE will negotiate on your behalf. Our most recent success story involves a disabled veteran who had fallen behind on his mortgage – 83 payments behind! Although he had attempted to modify his loan on his own, his mortgage company (surprise!) wanted nothing to do with him and offered him no solutions other than foreclosure. By working with Veitengruber Law, this disabled vet was able to stay in his home, making payments he can now AFFORD, without putting out any lump sum.

If you need help averting your home from foreclosure, please call us today at (732) 852-7295 for your FREE consultation. We live to keep people like you in your home!

 

 

Image credit: Ulbrecht Hopper

Bankruptcy and SSDI: Will I Lose My Disability Income?

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Americans who have worked long enough and paid Social Security taxes have a safety net in place if they happen to become disabled and can no longer work. Having paid into the system entitles all (previously or currently) employed workers to apply for disability benefits if the need arises. If you are someone who is currently receiving Social Security Disability Insurance payments, you’ve probably had mixed emotions about your situation.

Naturally, Social Security payments can be quite a relief to anyone afflicted with a chronic, life-altering illness. However, no longer able to perform duties that previously allowed you to work a paying job, it’s easy to become worried about whether you’ll be able to pay your bills. Although Social Security Disability Insurance payments are helpful, most people receive a fraction of what they were previously earning. If you are approved to receive disability insurance payments, the amount you receive is not based on how severe your disability is or how much money you were making when you became disabled. The Social Security Administration averages how much income you paid Social Security taxes on in the past – over many years. They then apply a formula to this average, using percentages called ‘bend points.’ Ultimately, your payments will be a percentage of what you earned throughout your working years.

Most Social Security Disability Insurance payments range from $300 – $2,200/month. In 2014, the maximum disability benefit amount was $2,642/month.

This leaves many people receiving significantly less ‘income’ than they were while working, and can eventually lead to a financial crisis. Previously, paying all of your monthly bills may have been a walk in the park, but if your income was suddenly cut in half or lower, you may quickly start struggling. You may find that it’s barely possible to pay your utility bills, mortgage, minimum credit card payments, and more.

We’ve met with several disabled clients who found themselves in similar situations – not wanting to lose their homes or the ability to properly support their families, they were up in arms about what to do next. Afraid that they would lose their back payments or ongoing Social Security Disability benefits, they were hesitant to file for bankruptcy.

If I File for Bankruptcy, Will I Lose My Disability Income?

You’ll be happy to learn that SSDI payments (including lump sums or back payments) are always exempt in Chapter 7  and Chapter 13 Bankruptcy proceedings.¹ If you are receiving SSI (Supplemental Security Income) payments, they are also exempt due to the strict rules about how that money can be used by recipients. In both cases, lump sum payments may have to be tracked in order to prove that they were indeed Social Security benefit payments.

If you receive private, state or other disability payments (NOT from the Social Security Administration), a certain amount of those payments will also likely be protected in a bankruptcy case.

Filing for bankruptcy while receiving disability payments IS POSSIBLE. You will not lose your only source of income. To learn more, please schedule a FREE consultation with my office today (732) 695-3303. We can help you wipe out many of your debts so that living on a fixed income is possible.

 

¹Nolo.com

Image credit: Simon Cunningham