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Senior-citizen property-tax deferral: Good, bad, awful; deadline passes

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This plea for senior citizen about the town's senior-citizen propety-tax deferral is by Rick Fentin, CFP®, Ed.M. Cambridge Financial Associates, Arlington. Questions? Email him at This email address is being protected from spambots. You need JavaScript enabled to view it..

Do you ever get up in the morning, open the refrigerator and see that three-day old leftover bowl of oatmeal that you thought you might eat?

It has apples in it and pecans and prunes and steel-cut oats – so good for you -- but looks like, you know what: awful! Well, thinking about the senior property-tax deferral is kind of like that oatmeal. It might be good for you, and it might be healthy for your budget, but do you really want to dig in?

Yes, You should try it: Add milk and fresh strawberries, heat it up in the microwave and enjoy some delicious extra cash flow in your life.

The senior-citizen property-tax deferral is one of the least advertised, least used and, in my opinion, potentially most helpful programs for seniors in the Commonwealth.

Here are the general rules

The program is available in most cities and towns. There may be specific differences from town to town. Ask about it. Below are the “general” rules for the wonderful town of Arlington.

If you are willing to admit to being age 65 or older, have total 2021 income (not just taxable) of  $92,000 or less, have lived in Massachusetts for the previous 10 years and have owned and occupied a house in Massachusetts for five years, you may be eligible to defer (not eliminate) payment of your property taxes until you die or sell your house.

You may pay an extremely low interest rate on the deferral of taxes, much lower than the typical rates for refinancing your house or for a home equity loan and far below the rates charged for reverse mortgages (sorry, Tom Selleck). Plus, there are no fees.

There are potential downsides to consider, which I will mention, but the upsides may make it worth at least tasting the oatmeal.

Enjoy $10k now?

Currently, if you qualify annually, you can defer all of the property taxes assessed on your house. Imagine having your house potentially increase in value each year and having an extra $5,000, $10,000 or $15,000 per year to enjoy now, rather than after you die. Those funds could make a big difference in helping you to live longer in the place that you love.

As usual, there are some perceived and some real potential downsides that need to be considered.

As a senior citizen, you may qualify for the Massachusetts senior circuit-breaker tax credit. Depending on the amount of taxes you defer, it may affect that credit.

Also, if you have a mortgage or high medical expenses, and you plan to itemize deductions on your tax return, property-tax deferral may negatively affect your itemizing. Talk with your tax adviser first.

On a more emotional note, some people are adamant about passing their houses on to their kids without any debt. That’s great if you have enough cash flow to live the life you want. But many seniors do not.

An unsustainable possibility

According to the recent American Community Survey, Arlington seniors 65 and older had a median income that is 50-percent lower than the median income of the 25- to 64-year-old group. But all pay the same rate for property taxes. This is unsustainable for many senior citizens. 

As far as the debt goes, I don’t think that most kids would mind inheriting a house that has appreciated significantly in value but has a small amount of property taxes due when sold. Talk to your kids about this or, on second thought, maybe it’s just better to make some fresh oatmeal while you look at property-tax deferral in a new light. 

Please pass the brown sugar and file your application for fiscal 2022 before April 1. Talk with the assessors' office.


This viewpoint was published Tuesday, March 8, 2022.

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