FAIR LAWN, NJ (Bergen County) – U.S. Congressman Josh Gottheimer announced Monday the introduction of a bipartisan bill to help cut taxes for seniors, save for retirement, and help retirees stay in Northern New Jersey.
The bipartisan Senior Housing Improvement and Retirement Accounts (IRA) Act of 2020 will help Americans save for retirement and encourage increased savings by allowing seniors who sell their principal residence to avoid paying the capital gains tax on the proceeds from that sale — if they are saved for retirement in a Roth IRA, Gottheimer said.
New Jersey is one of the best places in the world to raise a family, but it can be difficult for retirees to stay in New Jersey. According to the Tax Foundation, New Jersey residents pay the third highest property taxes in the entire nation. Another study ranked New Jersey as the fifth toughest state to retire in. Furthermore, for the second consecutive year, more residents moved out of New Jersey last year than any other state across the nation, Gottheimer said.
The Senior Housing Improvement and Retirement Accounts (IRA) Act will help Americans save for retirement and encourage increased savings by:
- Reducing the taxes paid from the sale of a home and
- Allowing seniors who sell their principal residence to avoid paying the capital gains tax on the proceeds from that sale if the proceeds are saved in a Roth IRA — for retirement.
“Right now, if you sell your home to downsize, you’re stuck paying taxes on any gains you’ve had on the house over the years. So, if you bought it for $150,000 in 1990 and sold it for $500,000 in 2020 – you need to pay the full state and federal gains over $250,000. That tax hit can really set a retiree back and force them to flee to another state,” Gottheimer said. “We should be encouraging those who have helped make our Jersey communities great to stay here. We shouldn’t be slapping seniors with outrageous taxes for trying to downsize their homes, making it even less affordable to live here. We need to do everything we can to cut their taxes and help them afford their retirement, and stay close to their friends and families.”
Gottheimer is introducing this bipartisan legislation with Republican Congressman, and fellow Problem Solver Caucus member, John Katko (NY-24).
Gottheimer made Monday’s announcement in Fair Lawn, which, through its Senior Citizen Advisory Committee, its leadership, and its partnerships with local organizations, is focused on addressing issues facing senior citizens and retirees, improving their quality of life, and integrating aging-friendly community building into local planning.
Gottheimer was joined by Assemblywoman Lisa Swain, Fair Lawn Mayor Kurt Peluso, Chair of the Fair Lawn Senior Citizen Advisory Committee Daniella Jordan-Mays, and Fair Lawn Councilman Kris Krause.