ravewest
New Member

Can I deduct prepaid real estate taxes due next year paid in 2017? Looking at new cap on RE taxes by congress of $10K.

 
user234200
Returning Member

Deductions & credits

With the new tax law is it still possible to deduct paying 2018 property tax in 2017 and deduct all on 2017 tax return
user234200
Returning Member

Deductions & credits

Please confirm I can deduct payment of 2018 Real Estate tax in 2017 on my 2017 tax return
Hal_Al
Level 15

Deductions & credits

Yes, you can pay RE tax in advance and deduct it on your 2017 return.

What you can't do (it's specifically prohibited in the new law) is prepay your state and local income tax (SALT) and deduct it.
Wings-Fan
New Member

Deductions & credits

Thought I read that the IRS ruled that you could only deduct prepaid 2018 property taxes on your 2017 return if you were billed for them in 2017?

Deductions & credits

This post was 2 months old and things may have changed since then.
Hal_Al
Level 15

Deductions & credits

Yes, that came out after this post. For years, you were allowed to prepay RE tax. But, with the new law, the IRS has written a rule against it.  The rule is that the tax must be accessed, not necessarily billed.
Wings-Fan
New Member

Deductions & credits

You are correct that the IRS said assessed, not billed.  I just don't know if they actually think of those as different things.  Now, my county re-assesses properties every three years.  The last assessment statement covered  2016, 2017 and 2018.  So, do you think this is what the IRS means by being assessed?  I paid the taxes based on the assessed value, but it is possible the tax rate will change this year.
Hal_Al
Level 15

Deductions & credits

I interpret the rule to mean the tax must be accessed; not the property.
Hal_Al
Level 15

Deductions & credits

Yes. If you pay your 2018 real estate tax in 2017; it is deductible on your 2017 federal return.

Edit 2/13/18: For years, you were allowed to prepay RE tax. But, with the new law, the IRS has written a rule against it.  The rule now is that the tax must be accessed, to be deductible when paid.

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