Important News Regarding Property Tax Deductions on Federal Income Taxes
Late yesterday afternoon, the IRS issued guidelines regarding the deductibility of 2018 prepayments. While tax bills sent and paid in 2017 are still deductible (nothing has changed for 2017), the new guidelines from the IRS indicate that 2018 taxes held in escrow until the 2018 tax bill is calculated in October are not deductible.
The Austin American Statesman covered this story in this morning’s paper at http://www.statesman.com/news/local/irs-statement-dampens-austin-area-rush-prepay-property-taxes/aWByiUkSJo0xKkcqWZPbPO/ and the IRS provides examples at https://www.irs.gov/newsroom/irs-advisory-prepaid-real-property-taxes-may-be-deductible-in-2017-if-assessed-and-paid-in-2017.
If you have additional questions about your federal income taxes, we strongly recommend contacting your CPA.