AUGUSTA – People applying for a property tax or rent refund may not be getting the money they’re due because of a glitch with the application.
Confusing instructions on the two-page Tax and Rent Refund Application could lead applicants to report more income than they actually have, reducing or even eliminating their refunds.
At issue is the part of the form that asks about income. It asks for adjusted gross income and then for other income, including dividends and interest. But dividends and interest are included in the first figure.
“It would have doubled my income if I’d done it the way the instructions said,” said Tieche Shelton, 68, of Farmingdale. “I’d have thrown it in the wastebasket.”
Shelton took his application to an accountant, who agreed with him the form is flawed.
The form is essentially the same as in previous years, but the line for dividends and interest income was blocked out before.
“The instructions are probably not as clear as they could be,” said Anthony Gould, assistant director of the income tax division at Maine Revenue Services.
The state began taking applications for the so-called “circuit-breaker” program on Aug. 1. Lawmakers this year expanded it to cover both property owners and renters, and raised the income minimums in an attempt to provide greater tax relief.
Officials have touted the increased popularity of the program, noting this week that 16,000 Mainers had already submitted applications.
Sen. Joseph Perry, D-Bangor, a Taxation Committee co-chairman, reviewed the form Thursday and agreed the dividends-and-interest portion could confuse some applicants.
“There could be someone who has most of their income come from dividends,” he said. “There’s probably some people out there that it would have a dramatic effect on.”
Gould said there’s no evidence anyone has made the mistake that prompted Shelton’s complaint. But he said it’s unlikely the agency would catch such an error.
Gould said future printings of the form would clarify that dividends and interest should not be reported more than once.
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