Prepaying taxes

[sseelhoff]

Paid ours on Tuesday. We always pay before the end of the year.

 

[buckeyefarmer]

Paidmine back in july for the year to get a reduction. Wont get next yrs bill till next july.

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[dragoneggs]

Can't prepay where we are. Here is an article on the subject with IRS guidance.

IRS says homeowners can only prepay property taxes if they’ve got the bill | The Seattle Times

 

[John Fitzgerald]

They do not accept prepayments here. The books don't open until sometime in late February 2018. I tried to pay last year in early Feb, and was turned away.

 

[Rustyiron]

I understand it to be that r/e taxes will be deductible up to $10k :confused3:
This makes sense why only the very blue, high property tax states (Cali, NY, NJ, etc) are complaining so loudly. Most of the country will be un touched by this if I understand this correctly.

 

[teejk]

I understand it to be that r/e taxes will be deductible up to $10k :confused3:
This makes sense why only the very blue, high property tax states (Cali, NY, NJ, etc) are complaining so loudly. Most of the country will be un touched by this if I understand this correctly.

Going forward real estate taxes will be "bundled" with state/local income taxes and the total will be subject to the $10k limit. The bigger issue is that the standard deduction increases such that many people will no longer itemize, hence the advice to pre-pay in 2017 and get some benefit from taxes that might not provide any benefit if paid next year (kind of a "double dip" in a way but perfectly legal and really only relevant in this "transition" year).

 

[teejk]

I paid numerous property taxes early. Fortunately I had a bill in hand for each-- even though the next installment(s) were not due until 2018. One of my pet peeves is that property taxes in various counties and states do not have uniform due dates. But I guess I should be glad to have that problem! :laughing:

btw, the IRS announcement was only an "advisory," not a ruling. So like many things, you do what is best and things will unfold to where you learned if it was a good thing to do or not. Things could change in the future. But I think you are pretty safe pre-paying taxes if you already have a (future) bill in hand.

Actually the guidance can be relied upon I think. And actually it might be generous in some states. The real test should have been whether a "lien date" (as opposed to an "assessment date") is fixed before the end of the year. Guess they didn't want to have to explain that.

 

[TheMan419]

The real issue is the increase in the standard deduction. That will make most itemized returns go away. Right now something like 1/3 of all returns are itemized. The prediction is less than 10% will be itemized.

One of the big losers is predicted to be charities. If you give to a charity you get a deduction (if you itemize). Now if you don't itemize you are not getting that deduction. That will cause some people to give less.

 

[teejk]

The real issue is the increase in the standard deduction. That will make most itemized returns go away. Right now something like 1/3 of all returns are itemized. The prediction is less than 10% will be itemized.

One of the big losers is predicted to be charities. If you give to a charity you get a deduction (if you itemize). Now if you don't itemize you are not getting that deduction. That will cause some people to give less.

Wait a minute...currently you give $1 to a charity so that you get back 15 cents (or 20 or 25 or 35 cents depending on your bracket)? Does that mean that the federal government in effect "matches" your contributions? I don't buy that logic. IMHO people give to charities because they want to. The increased standard deductions are in effect assuming that you will continue to give (or pay taxes), you just don't have to keep track of them all.

 

[Stimw]

None of the news articles that I have seen and no one here has suggested just maybe these high tax states could learn to get by with less like the other states have done.
Tax and spend!