This section highlights some of the questions seniors have regarding the latest scams, identity theft, taxes, Medicare, Social Security, Senior Support Services, and other topics.
Question: Will there be an increase in my Social Security benefits in 2024?
Answer: YES, the Social Security Administration recently announced a 3.2% increase in benefits due to the 2024 Cost of Living Adjustment (“COLA). This will be reflected on 2024 Social Security benefits. This boosts the average retiree's monthly payout (average = $1,733 in 2023) by approximately $55. This increase compares to the 8.7% cost of living increase in 2023 and a 5.9% increase in 2022.
Question: When should I receive all my 2024 Income Tax Forms?
Answer: Keep an eye out for these documents stating "IMPORTANT TAX INFORMATION". You should receive most of your forms like your Social Security statement (SSA-1099), 1099-R’s , W-2 (if you had a job last year), bank interest statements (1099-INT), Dividends (1099-DIV), etc. by February 1st, 2025. But, if you sold any securities (e.g. common stock, bonds) during the year, the brokerage houses have until February 15th, 2025 to get the forms in the mail to you. BUT... don't be overly concerned if you haven't received all your documents by the above due dates. Sometimes the documents get delayed a few days. And… brokerage houses can issue corrected/updated statements after those dates.
Question: I've heard that New Jersey's Estate Tax went away? Is that true?
Answer: This is true! New Jersey eliminated its Estate Tax in 2 steps. Beginning January 1, 2017, the exemption increased from $675,000 to $2,000,000 ($2 Million). Beginning January 1, 2018, the New Jersey Estate Tax was totally eliminated. But, keep in mind, there is still a New Jersey Inheritance Tax that is imposed on the recipients of the inheritance. Direct lineal heirs (e.g. parent, grandparent, spouse, child (including legally adopted and/or mutually-acknowledged child), grandchild, great-grandchild, stepchild, civil union partner, domestic partner) are considered CLASS A beneficiaries and are exempt from the NJ Inheritance Tax. CLASS C includes a brother or sister of the decedent, spouse or surviving spouse of a child of the decedent, civil union partner or the surviving civil union partner of a child of the decedent). The first $25,000 is not taxed with tax rising from 11% to 16% depending on the amount inherited. CLASS E includes Qualified Charity, Religious Institution, Education/Medical Institution, Non-Profit, State of NJ or political subdivision. CLASS D is anyone (e.g. friend) not included in CLASS A, C, or E and is taxed at 15% for the first $700,000 and then 16% thereafter. (Note: There is no CLASS B Beneficiary Class as it was eliminated in 1963.)
Question: What is the earliest I can start to collect Social Security?
Answer: Normally, if you are not disabled, you may opt to take early Social Security (with reduced benefits; see next question) at age 62. Your full retirement age ("FRA") depends on your date of birth. It used to be 65 years old but, based on the fact that Americans are living longer, and in an effort to stabilize the Social Security platform for future generations, Congress is steadily increasing the FRA. For example, the FRA has increased to 67 years old for Americans born in 1960 and thereafter.
Question: OK. I can start to collect at age 62, BUT is this the BEST TIME to start my benefits?
Answer: Normally, assuming you are in good general health, the longer you can hold off before commencing your Social Security benefits, the better off you'll be financially. That's because if you start collecting at age 62, the Social Security Administration reduces your benefits by a set percentage for each month BEFORE YOU REACH YOUR FULL RETIREMENT AGE ("FRA"). This makes sense because you'll be receiving benefits for 3 to 5 years longer than someone who waited until their FRA. The maximum reduction at age 62 will be 25% for people who reached age 62 in 2013 and 30% for people born after 1959. For example, someone born in 1960 (whose FRA is 67 years old) that starts collecting Social Security at age 62 will have their monthly benefits reduced by a full 30%. If they waited until they were 63 to begin collecting, their benefits would be reduced by 25%, if 64 by 20%, if 65 by 13.3%, if 66 by 6.7%. So you can see, it makes financial sense to hold off commencing your Social Security benefits IF you can afford to AND IF you're in good health! You can delay starting your Social Security benefits until you reach Age 70. The benefit of delaying your collection of Social Security is that you will receive 8% more each year from your FRA year (e.g. 67) until you reach age 70 (an extra 24% per month).
Question: What are the details of New Jersey’s Senior Freeze Property Tax Reimbursement?
Answer: NJ residents age 65 or older, as well as disabled residents, may be eligible for the property tax relief program known as New Jersey Senior Freeze. This program reimburses them for property tax increases on their principal residence. To qualify, applicants must meet all the eligibility requirements for each year from the base year (the first year they met all the requirements, such as age, residency or ownership) through the application year (the current application year is 2023). The 2023 Senior Freeze application deadline is October 31, 2024. The Senior Freeze (Property Tax Reimbursement) Hotline is 1-800-882-6597. Using 2023 as the base year, eligibility requirements for new applicants are that they:
. Be at least age 65 or receive Social Security Disability benefits;
· Must have been a New Jersey resident for at least the last 10 years, either as a homeowner or renter;
· Have owned and lived in that home for the last 3 yrs and paid full amount of property taxes on the home; or
· Have leased & lived in a mobile home park for last 3 yrs and paid full amount of property taxes/site fees;
· Live below required income level for eligibility, which in 2023 is $163,050 (including ALL Social Security benefits). Those who filed an application and met all the eligibility requirements should receive an application (PTR-2) mailed to their homes by late February of each year.
Those who met the eligibility requirements for the past two years and are filing for the first time can download Form PTR-1 from https://www.state.nj.us/treasury/taxation and click on “Senior Freeze”.
Question: What are the most important next steps when a Senior loses their spouse or loved one?
Answer: This is a particularly stressful time for all concerned. The Funeral Director can provide useful suggestions and assistance during this time of need. They often will take on the task of notifying the Social Security Administration of the death. They typically provide (for a per-certificate fee) multiple copies (5-10) of the Death Certificates. Death certificates are required to claim life insurance benefits, transfer assets, probate the Will (if necessary), etc. Contact all former employers of the decedent as the family may be eligible to receive death benefits. Notify administrators of Life Insurance policies. Did decedent serve in U.S. Military? If so, may be eligible for military benefits. Have safe deposit box? Review all assets to determine if held jointly vs individually. Individually-owned assets may require probating of the Will whereas, if all assets were jointly-owned by spouses, probation of the Will may not be required. It is also recommended that the spouse review all their financial holdings to ensure they have proper and updated beneficiary designations, both before AND following the death of a loved one. This is to ensure the assets go to the intended parties, and to the extent possible, are not tied up in the legal probate process.
Question: What is the NJ ANCHOR Program? Am I eligible? Scheduled for 2025?
Answer: ANCHOR stands for Affordable NJ Communities for HOmeowner’s & Renters. It is a Property Tax Relief program which replaces the former NJ Homestead Rebate. It is designed for NJ Homeowners AND TENANTS who owned/rented a home or rental unit (as of October 1, 2020) and paid all their assessed property taxes and had 2020 NJ Gross Income less than $250,000 (for Homeowners) and less than $150,000 (for Renters). The 2025 NJ proposed state budget includes the ANCHOR program but this is subject to change. You must apply for this benefit and more information is available at the NJ ANCHOR website: https://www.nj.gov/treasury/taxation/anchor/faqs.shtml .
Question: When MUST I enroll in Medicare?
Answer: You MUST enroll in Medicare within a 7 month window beginning three (3) months BEFORE you turn 65 years old, the month of your birthday, and three months after. If you enroll after this timeframe, you will be required to pay a late enrollment penalty for the rest of your life! You must enroll in Medicare once you turn 65 years old EVEN IF YOU ARE NOT YET COLLECTING SOCIAL SECURITY BENEFITS.