EXHIBIT D.-TAX RELIEF FOR RENTERS AND HOMEOWNERS (65 AND OVER)

The New Homestead Relief Act

STATE COMMISSION ON AGING, MADISON, WIS.

You may receive this relief if—

your were 65 or older as of January 1, 1966;

your income was under $3,500 in 1966;

you live in Wisconsin all of 1966;

you do not receive County Old Age Assistance, Aid to the Blind, Aid to the Totally and Permanently Disabled at the time of filing;

you paid rent or owned a home in 1966;

you file for the refund between January 1, 1967 and April 15, 1967;

you file a copy of U.S. tax form 1040, Wisconsin tax form 1 and its schedule H. If you have no taxable income you need not file the federal form. You do NOT have to pay income tax to be eligible.

What is Your "Income" Under this Act?

Only the income of yourself and your spouse living with you.

Income which is ordinarily reported for Wisconsin income tax purposes, PLUS receipts from social security, disability payments, retirement benefits, income from out-of-state business or property, workmen's compensation, loss-of-time insurance, cash public assistance, support money, interest on savings bonds, but not relief granted under this act.

Renters

You are a "renter" if you pay to live in an apartment, room, nursing home, hospital, mobile home, etc.

Use 25% of the rent paid in 1966 for occupancy only as the amount of your "property tax." This amount is not to exceed $300.

With your application, send a statement of rent paid, signed by your landlord. If you rented furnished quarters, or if utilities (phone, light, heat) were furnished, reduce the amount of your yearly rent by the reasonable rental value of the furniture and/or utilities.

Your rent should not be raised as a result of filing for homestead relief.

Homeowners

Property taxes are those taxes which were assessed against your home in December of the tax year. This does not include special assessments, delinquent tax payments or the amount credited under the state property tax relief fund.

If your home is part of a larger unit (farm, building used for business etc.), and you receive a single property tax bill covering this larger unit, you may use the total property taxes for 1966 as shown on this bill (up to $300) provided no more than 40 acres are included. If more than 40 acres are included, do not use taxes on land in excess of 40 acres.

No lien or claim will be filed against your home for any legally-obtained tax relief you may receive under this act.

You may file without having paid the full amount of the taxes!

Changes have been made in the Act since last year

The new tax form is greatly simplified

An easy-to-read tax table comes with the forms

The Tax Department will compute your refund amount for you if you prefer not to do it yourself.

APPENDIX 2

LETTERS AND STATEMENTS FROM INDIVIDUALS AND

ORGANIZATIONS

STATE OF INDIANA

COMMISSION ON THE AGING AND AGED,

Indianapolis, Ind., July 2, 1969

MY DEAR SENATOR Moss: I am pleased to know that you are holding hearings on subjects related to home ownership of the elderly soon. I would like to describe what I think is a completely unfair situation in Indiana and probably in other states as well. We have in Indiana an act which makes available to any individual over 65 years of age whose property has a value not in excess of $5,000 and whose income is not in excess of $3,000 a tax exemption of $1,000 on the value of his property. But when urban renewal people force an individual out of his property he obviously has to move and he doesn't get this $1,000 exemption on the property which he acquires until he has lived in it for a year.

The individual did not elect to move, he was forced to make the move. I have not been able to find any evidence that he was paid an amount that includes an amount equal to this $1,000 exemption. Many times he finds it impossible to buy a piece of property equal in value to him as to the property he had to vacate. I know this is not a problem but I think older people are being victimized when urban renewal agencies force them out of their homes, and the state does nothing to give them their tax exemption in their new home which they had on their old one until the individual has lived in the house for a year.

I hope this will be given attention in the hearings which you are planning on holding and if nothing can be done on the state level, I hope something can be done on the federal level covering this particular situation.

Cordially yours,

Dr. GEORGE E. DAVIS,

Executive Director.

LOUISIANA STATE UNIVERSITY IN NEW ORLEANS,
INTERNATIONAL MARKETING INSTITUTE,
New Orleans, La., July 30, 1969.

DEAR SENATOR WILLIAMS: Attached is a brief report of some of the findings from the 1960–61 Survey of Consumer expenditures relevant to home ownership rates for one and two person elderly units and spending for shelter and utilities. I hope that this information will be of some interest to your committee.

Sincerely,

JOHN A. REINECKE,
Professor of Marketing.

SOME FACTS ABOUT HOMEOWNERSHIP AND COSTS OF SHELTER AMONG OLDER PERSONS AND 2-PERSON HOUSEHOLDS HEADED BY OLDER PERSONS (1960-61) The attached tables indicate something about mean homeownership rates and expenditures for shelter and utilities by males living alone, females living and two-person families headed by persons in three age groups: 55–64 years; 65–74 years and 75 years or more. These data should be interpreted with an appreciation of the fact that all elderly persons living in households with more than one other member are excluded as are those living with one person under 55 years of age who is reported as head of the household in question. Compare, for example the information reported in the Social Security Administration Research Report 19,

"The Aged Population of the United States: the 1963 Survey of the Aged," pages 166-8 and 174-5.

The BLS data shown in Exhibit 1 below indicate that of males living alone, about two-fifths of those 65 or older own their own home and one-third of those 55-64 were homeowners. Among females living alone roughly half owned their own homes at all three age levels. Among two person units seven in ten were homeowners, with no appreciable variation among the age groups. The 1963 Social Security Study (p. 167) indicates somewhat lower rates for non-married men living without relatives than shown in Exhibit 1. Both sources, however suggest that a greater incidence of home-ownership accompanies increasing age. For non-married women with no relatives present the SSA study also yields somewhat lower rates than BLS except in the age group under 65. Among couples the relationships is reversed. The 1963 study indicates slightly higher rates of homeownership in those found in BLS data and somewhat lower rates of homeownerships among the oldest couples than among those under 73 years of age. According to the same Social Security Report, homeownership rates are slightly lower where relatives live with elderly couples and significantly lower (after age 65) where relatives live with non-married women. Among non-married men, the effect of residing with relatives upon homeownership is not clear. There is strong interaction with age. Under age 72, non-married men living with relatives are more likely to own their own homes than those living alone. For men 73 or older the opposite is true.

Returning to Exhibit 1, it is clear that the incidence of homeownership is not related to income level. The only exception is that the two person units with income below $2000 per annum and headed by persons under 75 years of age are shown to have lower homeownership rates than their counterparts with greater incomes. Inference regarding males is difficult because of small sample size.

Exhibit 2 gives some indication of the costs of shelter and utilities among elderly one and two person families in 1960-61. A full appreciation of this exhibit requires the understanding that this expense includes only rent and utilities (and repairs, if any) for renters and insurance, interest, and repairs for owners. Reduction in principal of mortgage is excluded. One of the outstanding features of this exhibit is the fact that shelter-utility expenditure by owners declines more sharply in old age than such expenditure on the part of non-homeowners. This is true for all three unit types. Also, the decrease in such spending occurs earlier in life for owners.

Another important phenomenon is that of the low income elasticity of such expenditures, particularly in the lower income ranges. This is especially true among single females. It is clear that elderly women must allocate a huge proportion of their income to this basic need. This is especially true of those over 65 with an income level of less than $2000 (a majority of women over 65 in 1960-61).

Shelter expenditures reported here are slightly below those reported by SSA in 1963 with respect to renters (see p. 411 of SSA study). This might be largely attributable to price increases in the time interval and to minor definitional discrepancies. There is a much larger discrepancy in the case of homeowners because SSA apparently includes reduction of mortgage principal. An examination of my Exhibit 4 allows a rough comparison of housing expenditures by homeowners as reported in the two sources. BLS data suggest somewhat lower housing expenditure by single males and couples than does the SSA report, but these data (the sum of my Exhibits 2 and 4) indicate significantly higher housing expenditure levels for single females than those found in the 1963 study by SSA (p. 411).

An appreciation of the way in which housing dominates the spending, or, more explicitly, the resource-allocation of the elderly poor, especially that of women over 65 years of age cannot be complete without an examination of the extent to which the assets of such persons are tied up in housing. Exhibit 3, derived from home value and mortgage balance data, shows what a large part of the resources (in addition to out-of-pocket housing costs) of the elderly are "locked into" the area of housing. In many cases this represents a grossly un-economic allocation of scarce resources. It makes sense to say that the owned home (often the only large asset) of an older person represents a kind of imputed income, although it has strictly limited use. At the same time homeownership by older persons represents a kind of fixed and often unnecessary expenditure. Such ownership often has far-reaching effects upon the life-style of the aged owner. It influences other expenditures, too, and renders the aged person less mobile.

Time does not permit greater elaboration of this aspect of the spending pattern of older people. I will be pleased to answer any further questions which might be of help to the Committee.

EXHIBIT 2.-MEAN EXPENDITURES FOR SHELTER AND UTILITIES BY INDIVIDUALS (MALE AND FEMALE) AND 2-PERSON FAMILIES BY INCOME CLASS, AGE OF HEAD, AND HOMEOWNERSHIP STATUS

EXHIBIT 3.-MEAN IMPUTED INCOME FROM HOME, 1960-61 HOMEOWNERS