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Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsPrepaying Your Property Taxes? I.R.S. Cautions It Might Not Pay Off
The Internal Revenue Service has a message for the homeowners rushing to prepay their property taxes before new rules take effect on New Years Day: Not so fast.
The tax bill that President Trump signed into law last week sharply limited the itemized deductions for state and local taxes while raising the standard deduction for individuals and couples. Those rules do not take effect until 2018, however. That has led some homeowners, particularly in high-tax, affluent areas, to try to prepay their 2018 property taxes before the deduction disappears.
In an advisory notice posted to its website on Wednesday, the I.R.S. said that maneuver could work, but only under limited circumstances. To qualify for the deduction, property taxes not only need to be paid in 2017, they must also be assessed in 2017 meaning that homeowners who prepaid their taxes based on estimated assessments, or who tried to pay several years worth of taxes at once, will probably be out of luck.
Those individuals now are not getting the benefits of those prepayments, Nicole Kaeding, an economist at the Tax Foundation, said of people who paid taxes that had not yet been assessed. All that youve done is provided an interest-free loan to your municipal government.
https://www.msn.com/en-us/money/personalfinance/prepaying-your-property-taxes-irs-cautions-it-might-not-pay-off/ar-BBHqxPb?li=BBnb7Kz&ocid=edgsp
Turbineguy
(37,372 posts)are moaning.
former9thward
(32,082 posts)The actual bill comes later. So most people will be able to deduct. Cook county, where I live, has already received $310 million in advanced tax payments.
Yo_Mama_Been_Loggin
(108,232 posts)But the assessment has to be done this year. In the county where I live it's done early in the year.
Still my property taxes aren't high enough to for an early payment to make a difference on my federal taxes.
TheBlackAdder
(28,222 posts)They were supposedly produced and scheduled to be delivered by mail next week, but will provide on-site copies.
MissB
(15,812 posts)So no chance for savings for anyone around here.