I understand that for federal taxes I am capped at $10000 for salt. But let’s say my property tax is $11000 (I usually prepay feb 2019 in 2018 or whatever year prior as California allows this). I feel I should still do this so that I can deduct this full $11000 for my California state tax forms. If not, and I only pay half which is due in September 2018, I would only deduct $5500 from state, and I would lose out on a potential $550 reduction in state tax (assuming California is taxed at 9-10%). Has anyone thought about this issue? If you were me would you not prepay the February 2019 portion as I would only deduct it from state income tax forms (for federal I would add the $5500 plus my state income tax deduction to equal the max $10000).
All I know for sure, is that your 2019 property taxes must be "assessed" (billed) in 2018 in order for you to deduct/claim them on the 2018 tax return. That's how it stands right now. But with some states enacting workarounds for the $10K limit, the IRS has put out differing notices that they are working on wording and legislation to deal with those workarounds. So until final legislation is enacted it's impossible to know what the tax implications will be "for sure" if you pay a 2019 tax liability, in 2018.