“America is a land of taxation that was founded to avoid taxation.” - Laurence J. Peter

Introduction:

If you're a renter you may be eligible for a tax break. After all, if homeowner's get tax breaks for paying their mortgage, why shouldn't you for payint it too? The renter's credit is not a federal credit and offered at the state level to put cash back in your pocket. Keep reading to see if you're eligible to take the credit.

Who can claim the renter’s tax credit?

The rules differ from state to state, but here are few things that are consistent for the most part across state lines when it comes to determining eligibility for the renter’s tax credit:

• Being a resident of the state in which you rent

• You must be legally responsible for paying the rent, i.e. your name must be on the lease agreement.

• You can't be claimed as a dependent on somebody else’s tax return

• Your property owner is paying taxes on the property in which you rented. This is to mitigate the effect of rising property taxes getting passed on from owners to their tenants, on of the main purposes of the renter's credit.

States offering a renter's tax credit

Select the state from the list below to see the eligibility requirements in that particular state to claim the credit.

Arizona

Offers a credit to renters who meet all of these requirements:

• Lived in Arizona the entire year

• Paid rent on a main home in Arizona during the tax year

• Were 65 or older by December 31, 2023 or received Title 16 Supplemental Security Income

• Earned a total household income less than $5,501 or less than $3,751 if they lived alone

California

Offers a credit to renters who meet all of these requirements:

• Paid rent in California for at least half the year

• Earned $50,746 or less (single or married/registered domestic partner filing separately) or $101,492 or less (married/registered domestic partner filing jointly, head of household, or qualified surviving spouse)

• Didn’t live with someone who can claim them as a dependent

• Weren’t given a property tax exemption during the tax year

You’ll get $60 if you’re single or married/RDP filing separately or $120 if you’re married/registered domestic partner filing jointly, head of household, or qualified surviving spouse.

Colorado

Offers a rebate to renters who meet all of these requirements:

• Lived in Colorado the entire year and paid property tax, rent or heating bills

• Your total income from all sources was less than $18,026 for single filers and $23,345 for married filing jointly

• Are 65 years of age or older, a surviving spouse 58 years of age or older, or disabled

• Aren’t claimed as a dependent on another person's federal income tax return

Colorado renter's can qualify for a rebate up to $1,044 a year and if you apply by April 15, 2024, you could receive up to a $1,600 TABOR refund ($800 for single filers). You can apply for the rebate here.

Connecticut

Offers a rebate to renters who lived in Connecticut for at least one year and are:

• 65 years old or older

• 50 years old or older and a surviving spouse of someone who was entitled to renters tax relief, or 18 years old or older and disabled

You can get up to $900 if you’re married or $700 if you’re single. You need to apply with this form to receive this rebate.

District of Columbia (DC)

You must meet the following requirements to claim this credit:

• You rented or owned and lived in a home, apartment, rooming house, or condominium in DC for all of 2023.

• Your residence isn't part of a public housing dwelling.

• Your AGI was $61,300 or less ($83,700 or less if you're age 70 or older).

• You didn't rent from a landlord whose property was either exempt from real property taxes or who paid a percentage of rental income to DC instead of paying a real estate tax.

• You can't be claimed as a dependent on someone else’s return, unless you reached age 65 on or before December 31.

Hawaii

Offers a credit to renters who meet all of these requirements:

• Made less than $30,000

• Are a Hawaii resident who was present in Hawaii for more than nine months of the tax year

• Paid more than $1,000 in rent

• Aren’t claimed as a dependent by someone else

Indiana

Offers a deduction to all renters (except those who rent property that is exempt from Indiana property tax), up to $3,000 ($1,500 if married filing separately).

Iowa

Offers a credit to renters who meet the following requirements:

• Had a household income less than $25,328

• Are 65 years of age or older or at least 18 years old and have a disability

• Rent property that is not exempt from Iowa property tax

• You have to apply for this relief every year using this form.

Maine

Offers a credit to renters who meet the following requirements:

• Paid rent on your primary residence in Maine during any part of the tax year

• Are not Married Filing Separately

• Can't be claimed as a dependent on another person’s return

• Made less than $57,500 if single, $75,000 if Head of Household (or $92,500 if you have two or more dependents), Married Filing Jointly, or Qualified Surviving Spouse

Maryland

Offers a credit to renters who are age 60 or older, disabled, or who have a dependent child and make below a certain income. You have to apply for this relief every year using an application from the State Department of Assessments and Taxation website.

Massachusetts

Offers a deduction to renters for up to 50% of your rent paid, up to $3,000 ($1,500 per return if married filing separately), as long as the rental property is your primary residence.

Michigan

Offers a credit to renters who meet the following requirements:

• Paid rent on your primary residence in Michigan for at least 6 months

• Made $67,300 or less in household income and resources

Minnesota

Offers a tax refund to renters who meet the following requirements:

• Spent 183 days or more in the state

• Aren’t claimed as a dependent by someone else

• Their household income was less than $73,5270

Missouri

Offers a credit to renters who meet the following requirements:

• Made $27,200 or less if single or $29,200 or less if married filing jointly

• Are 65 years of age or older, a surviving spouse 60 years of age or older, or disabled

• You can get up to $750. You need to apply here to receive this rebate.

Montana

Offers a credit to renters who meet the following requirements:

• Were 62 years of age or older on December 31

• Lived in Montana for at least nine months

• Rented a home in Montana for at least six months

• Have a household income under $45,000

You can get up to $1,150. You can claim this credit when you file your state tax return.

New Jersey

Offers two tax breaks for renters. You are able to choose the tax advantage that offers you the most money:

• A property tax deduction of 18% of your rent

• A property tax credit of $50

You can claim either the deduction or the credit when you file your state tax return.

New Mexico

Offers a rebate to renters who meet the following requirements:

• Are age 65 or older

• Have a modified gross income of less than $16,000 for the year

• Were residents of New Mexico for any part of the tax year

• Were physically present in New Mexico for at least six months

• Are not eligible to be claimed as a dependent of another taxpayer

• Were not an inmate of a public institution for a period of more than six months

The rebate can be up to $250 ($125 if married filing separately) and can be claimed when you file your state tax return.

New York

Offers a credit to renters who meet the following requirements:

• Have a household gross income of $18,000 or less

• Lived in the same New York residence for at least six months

• Were a New York State resident for the entire tax year

• Paid an average of $450 or less in monthly rent, not counting charges for heat, gas, electricity, furnishings, or board and including the rent other household members paid

• Owned property, such as houses, garages, and land, totaling to a value of $85,000 or less

• Aren’t able to be claimed as a dependent by someone else

You can get up to $375, depending on your income.

North Dakota

Offers a refund to renters who are 65 years of age or older or disabled and meet income requirements.. If 20% of your annual rent exceeds 4% of your income, you’ll receive a refund for overpayment of rent in the amount of the difference, up to $400.

You can apply for your refund here

Pennsylvania

Offers a rebate to renters who meet the following requirements:

• Made $45,000 or less (you can exclude one half of Social Security income in determining your income for this rebate)

• Are 65 years of age or older (if married and both spouses live in the same household, only one spouse must be 65 or older), a widow(er) 50 years of age or older, or disabled and at least 18 years of age

You can get up to $1,000 depending on your income. You can apply here to to see if you qualify.

Rhode Island

Offers a credit to renters who meet the following requirements:

• Are 65 years of age or older or disabled

• Lived in Rhode Island for the entire calendar year

• Had a household income of $37,870 or less

• Are current on all rent payments

Utah

Offers a refund to renters who meet the following requirements:

• Were 66 years of age or older on December 31 or are a widow(er) of any age

• Lived in Utah for the entire calendar year

• Aren’t claimed as a dependent by someone else

• Meet certain income requirements

Apply here to receive this refund.

Vermont

Offers a credit to renters who meet these requirements:

• Lived in Vermont for the entire year and rented for at least six months during the year

• Meet certain income requirements

• Aren’t claimed as a dependent by someone else

If you live with someone else who is not your spouse, you can each claim 50% of the credit without sharing personal income information with each other. You can claim it when you file your state tax return.

Wisconsin

Offers a credit to renters who meet the following requirements:

• Lived in Wisconsin from January 1 through December 31

• Are 18 years of age or older on December 31

• Have less than $24,680 in household income

• Have positive earned income, are 62 years of age or older, or are disabled

• Aren’t claimed as a dependent by someone else

• Aren’t receiving Title XIX medical assistance and living in a nursing home

• Aren’t claiming Wisconsin farmland preservation credit

• Aren’t claiming the veterans and surviving spouses property tax credit

• Aren't filing a claim on behalf of a person after that person's death

• Haven’t received Wisconsin Works (W2) or county relief payments for all 12 months in the year. If you received these payments for some months, the credit is reduced. If you received one of these payments for all 12 months, the credit is disallowed

Only one person per household can take advantage of this rebate.

In conclusion...

When it comes to tax credits of any kind, our recommendation is that you should typically take the government up on all offers for free money. It may make filing your taxes a little more complicated but in the end the money you get back might be worth the extra effort or expense of hiring a tax professional to assist you.

Other resources to help you get the most out of your tax refund

Tax Preparation Checklist:

Need help getting ready this tax season? Here is a quick checklist to ensure that you are prepared to take care of all the credits and deductions you may be eligible for to maximize your tax return: