Anyone else prepaying property taxes so you can still deduct them this year?

[Colleen27]

Well they already have. Comcast and AT&T announced bonuses. Wells Fargo & Fifth Third announced hourly wage increases. Boeing has also indicated its workers will benefit.

Except that some of those bonuses were already negotiated by workers' unions, and others have been annual traditions that are somehow because of the tax bill even though they are no different from last year or the year before. It sounds more like corporations finding a no-cost way to drum up some positive press for an unpopular tax plan that they benefit from immensely than an actual benefit for the "little guys".

THen remember that next time you vote for your state leaders. We in the the fiscally stable states have been subsidizing states (with our federal taxes) who aren’t financially responsible for years now (CA, NY, NJ, IL) so enough is enough

I think you need to revisit your sources on that one. CA has long been the largest "donor state" in the union, receiving about 80 cents in federal spending for every federal tax dollar collected there. NY and IL just about break even, contributing about a dollar for every dollar received. I'm not sure where NJ lands but I'll bet it is closer to those other states than to, say, Alabama or New Mexico which both receive more than $2 for every dollar collected.

 

[bdcp]

Same here were due December and May. We could pay the May one now for the write off if we wanted to. I think there are some people that pay monthly with their mortgage payment.

Anyone with a mortgage and escrow included pay the mortgage company monthly but that doesn't go to the actual tax bill monthly. The mortgage company pays taxes as they are due. In our case, that's twice per year. I'm just not sweating it.

 

[wendow]

We are likely to get hurt as we lose exemptions for 2 college aged children and get pushed from itemized to standard deduction.

Only one college-aged kiddo but I think we are in the same boat. We've itemized for many years but will now be pushed to the standard deduction. We are not upper middle at all though so not sure if I am thinking about this right or not. I have no idea how to really figure it out

 

[Hikergirl]

I think for us the change in the tax brackets and now being able to claim the full child credit for at least one of our kids is what helped offset losing the exemptions and what we normally itemize. Im not sure about the AMT for 2018 but last year it didnt hit us too hard so even if the calculators havent taken that in to account we should still end up saving something.
Being in NY i was thinking it was going to be alot worse.

 

[Minnesota!]

Sounds about right. Your deductions are about the same as ours. No student loan debt though. We've been deducting stock market losses from 2010. I'm not sure how many years we would have been able to do that, but I guess this will be the last year.

Thank you! I guess only time will tell..

Interesting about the stock market losses - I inherited a huge chunk of stock back in 2008, and cashed quite a bit of it at quite a loss...but was told I could only count that for 3 years, max.

 

[punkin]

Please, please, please...can we keep this topic limited to the practical rather than political? I am more interested at this point in making the new system work for me as much as possible than assigning blame.

 

[bdcp]

Our local supervisor just put out a fb post that per the IRS, you can't deduct future assessed taxes, so there isn't any benefit to paying early. We're not prepaying ours anyway. We can continue to itemize considering our interest alone is $21,000/year. We also have charitable giving which is a lot more than $3,000/yr.

 

[cruiser21]

Yep. I get both sides of this. But tell me why if you have one person making $300k in ct and paying $20k in property tax and $18k in state income tax and one person in FL with the same income and a similar lifestyle but only paying $10k in property tax and no state income tax, the person in FL pays federal taxes on an additional $28k of income. It’s not their fault ct pays its teachers 6 figures.

I grew up in CT and am very happy to be out of the Northeast. Still have family (stuck) there.

A lot of people move to Florida for that reason. I would think with the new plan a person making 100k in Connecticut and a person making 100k in Florida both with the equal number of kids would now pay the same amount of federal income tax. I pay more fed income tax then someone in California making the same amount of money because I basically have 1/3 the write offs that they have. Over all though I still come out ahead. I still have family in California and I'm sure they can't be happy about the new tax plan.

 

[cmarsh31]

Hanging out in line at our town hall. Estimated wait time is 90 minutes & they're not offering Fast Passes!

 

[GrnMtnMan]

Washington DC’s city government CFO just announced that DC residents will be able to deduct prepayments:

Late on December 27, 2017, the IRS issued a news release in the form of an IRS Advisory, “Prepaid Property Taxes May be Deductible in 2017 If Assessed and Paid in 2017.” In short, the IRS Advisory states, “State or local law determines whether and when a property tax is assessed, which is generally when the taxpayer becomes liable for the property tax imposed."

the District of Columbia, real property taxes for Fiscal Year 2018 (October 1, 2017 through September 30, 2018) are assessed, by law, as part of the approved budget approval process for the new fiscal year which begins October 1. At that time, the tax rate is set and the liability is established for all properties for the fiscal year. Taxpayers also received Notice of Proposed Assessments for Fiscal Year 2018 as of March 1, 2017. Taxpayers must make payments on or before March 31, 2018 and on or before September 15, 2018. The billings for the first half of the fiscal year will be sent no later than February 28, 2018 and for the second half of the fiscal year on or before August 15, 2018. The attached IRS Advisory provides two examples for when a taxpayer can and cannot deduct prepayment of these taxes in 2017. Based on a legal review by the Office of Tax and Revenue, the District falls under Example 1 which indicates taxpayers prepaying their 2018 tax bills in 2017 can deduct the tax payments on their 2017 tax return. Pursuant to the IRS Advisory, since the District both assessed properties and set real property tax liabilities in 2017, there is a basis, if a taxpayer chooses to prepay real property taxes by December 31, 2017, for the taxpayer to claim a deduction on his or her 2017 return.​

 

[kydisneyfans]

Not prepaying as the assessment hasn't happened yet, so that is worthless.

I am going shopping after work today to get all the home office supplies needed for 2018, used to be once a quarter. Those can be written off.
We are changing all of our charity deductions for 2018 from monthly to a lump sum on 12-31-17, then will resume in 2019. We can claim those this year.
Any education, software and book costs related to work are being bought this week. All January utility bills are being paid on Friday. They are on budgets, so I know the amounts due. The loss of the home office and work related non reimbursed expenses is hitting us pretty hard.

Our plan is to use the standard deduction in even years, double up on things to itemize in odd years. An example is charity, giving planned 2018 money by 12-31-17, then giving 2019 and 2020 in 2019 to claim it all at once. I may even push 2018 property tax and pay it on 1-1-19, then pay the 2019 tax on 12-31-19. Not sure what the late penalties and if it would be worth the cost yet.

We may look at a refi to get our home equity back into the mortgage since 1 can be deducted, but not the home equity anymore. I think closing costs would outweigh the tax benefit and we don't owe an insane amount on the HE anyway.

 

[WebmasterDoc]

The political commentary needs to stop.

Thanks in advance for your cooperation.

 

[floridafam]

I need to sit down and go over the numbers. We will also lose two exemptions for our two in college.

DH also made more in 2017 than in 2016. I’m hoping that bump doesn’t completely destroy financial aid for the above mentioned two in college.

 

[cruiser21]

Thank you! I guess only time will tell..

Interesting about the stock market losses - I inherited a huge chunk of stock back in 2008, and cashed quite a bit of it at quite a loss...but was told I could only count that for 3 years, max.

Not sure how much it helped we still would have paid 3k less this year with the new tax plan. We made a little more money this year. I wish we didn't have to waiy until 2019 to benefit. Our income can vary 20k from year to year based on overtime and any profit sharing.

 

[floridafam]

OT is how my DH bumped his income up. They are short staffed. His company promised to hire more people after the tax bill passed. I’m hoping that’s true.

 

[cruiser21]

OT is how my DH bumped his income up. They are short staffed. His company promised to hire more people after the tax bill passed. I’m hoping that’s true.

I certainly don't mind making more and paying more.

 

[floridafam]

I certainly don't mind making more and paying more.

True. Financial aid is where it stings us. Like there’s an imaginary line at one income and aid is cut significantly if we cross that line by $100. Thank goodness one will be a senior next year and he already has a paid internship lined up for this summer.

 

[Mackenzie Click-Mickelson]

So my husband figured out and based on 2016 rates (as we haven't gotten finalized information for 2017) originally we would have owed around $1,000 however with the student loan interest being retained and the tax rate lowered for our taxable income bracket above X amount (which helped offset things) for 2016 numbers the new tax plan would cost around $97 more. He thinks 2017 will be roughly that give or take some but won't be near the $1,000 previously expected because the tax plan was adjusted before it was actually passed.

Losing the personal exemption does hurt us just not as bad as it was originally going to be.

 

[Dakota731]

t sounds more like corporations finding a no-cost way to drum up some positive press for an unpopular tax plan that they benefit from immensely than an actual benefit for the "little guys".

I would be happy to get a bonus no what my company’s motive! I guess if you are so financially secure that a few thousand dollars doesn’t matter to you then that’s a different world than I live in. We would be (and are) very grateful for a bonus, a raise or a tax cut in any shape or form! Keep em coming!

 

[MermaidMommy]

Count me in as one of the middle class who will have to pay more in taxes next year, between $3000-$4000. Having a child in college, and losing the individual exemptions is going to hit us hard. They say one of the groups who will fare the worst — whose taxes will increase — are middle/upper middle class parents of college students.

It’s frustrating to hear how “family-friendly” this bill is. It’s not, and it wasn’t designed to be.