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Washington Tax Structure

Information from the Washington State Department of Revenue:
Property Tax Exemptions and Deferrals for Senior Citizens and Disabled Persons

Part 1:

Part 2:

Part 3:


Part 1:

How to Compute Disposable Income

The maximum levels of income to qualify for each program are different. However, computation of disposable income is the same under both programs. The disposable income you received the year before you apply determines your eligibility for both programs. Disposable income includes all sources, whether or not they are taxable for federal income tax purposes. You may not deduct losses or depreciation. Some of the most common sources of income include:

  • Wages, salaries, and tips
  • Social Security benefits
  • Railroad retirement benefits
  • Pension and annuity receipts, including retirement bonds, Individual Retirement Accounts, and distributions from Keogh plans. An annuity is a payment of a fixed sum of money received at regular intervals. Some examples of annuity payments  include unemployment compensation, disability pay payments, and welfare receipts (excluding amounts received for the care of dependent children).
  • Interest and dividend receipts
  • Business income. Depreciation and business losses may not be deducted.
  • Rental income. Depreciation and rental losses may not be deducted.
  • Capital gains                                                             

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If you were retired for two or more months of the preceding year, your household income will be computed by multiplying the average monthly disposable income received during the months you were retired by twelve. If your spouse died before November 1 of the preceding year, your household income is computed by multiplying the average monthly disposable income, after the death of your spouse, by twelve.

Deductions from Disposable Income

When computing disposable income, you may take deductions for the following:

  • Capital gains you receive from the sale of your principal residence if the gain is reinvested in a replacement principal residence.
  • Non-reimbursed amounts you pay for yourself or your spouse to live in a nursing home, boarding home or adult family home.
  • Non-reimbursed amounts you pay for goods and services that allow you, your spouse, or co-tenant to receive in-home care. The care received must be similar to the care provided by a nursing home.
  • Medical treatment, physical therapy, Meals on Wheels (or similar meal delivery service), household and personal tasks are examples of service expenses that you may deduct. Personal care tasks include receiving assistance- with meal preparation, eating, dressing, medications, and personal hygiene.                                                                     
  • Special furniture and equipment, such as wheelchairs and hospital beds, and oxygen are examples of goods expenses that you may deduct.
  • Non-reimbursed prescription drugs.
  • Medicare-Part B Insurance Premiums (beginning with 2005 taxes)
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More Information                                              

Additional information may be obtained in the tax statute (Chapters 84.36 and 84.38 of the Revised Code of Washington) and in the Department of Revenue's administrative rules (Chapters 458-16A and 458-18 of the Washington Administrative Code).

Questions?

If you have any questions or need assistance in completing the application, contact the Whatcom County Assessor's Office.

Or you may contact:

State of Washington, Department of Revenue
Property Tax Division
PO Box 47471
Olympia, Washington 98504-7471
Telephone: (360) 570-5900
http://dor.wa.gov/content/FindTaxesAndRates/PropertyTax/Default.aspx

To inquire about the availability of this information in an alternate format for the visually impaired, please call 360-705-6715.  Teletype (TTY) users please call (360) 705-6718.

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