Got a supplemental property tax bill for 7/1/2018 to 6/30/2019. It has 2 installments. I paid the 1st on 12/31/2018. Can I deduct that as additional property tax?

[utsav21]

I bought my home in 2018. I paid the property tax via the lender's escrow. Then I got a supplemental property tax bill for the 7/1/2018 to 6/30/2019 period. This is due in 2 installments. I paid the first installment on 12/31/2018. Can I deduct that as additional property tax? I intend to pay the second installment in May 2019. Can I deduct that too? In general for property tax is the deduction based on the year for which the tax bill is or is it determined by the year the tax is paid in?

[Texas Roger · Accepted solution]

The deduction is for property taxes paid in the tax year. You can claim the 12/31/2018 payment but not the May 2019 payment. The May 2019 payment cannot be deducted until you file your 2019 tax return in early 2010.

[ScruffyCurmudgeon]

@Texas Roger  - Roger, actually last year when it was the last year for folks with high property tax to be able to claim the entire amount, that was allowable!

[ScruffyCurmudgeon]

Whoops - was reading that you were trying to deduct what was paid, but you in fact had not paid this second amount.  Cash basis taxpayers report deductions in the year paid.

[utsav21]

@Texas Roger thanks! I guess you mean early 2020...

[Texas Roger]

Yes 2020.

[ScruffyCurmudgeon]

See the following IRS advice for last year when it was truly meaningful as the last year to be able to deduct property taxes in excess of $10,000.  The key point that allows deductiblity, as stated in the IRS advisory, is if you, or the property that you own was assessed in 2018, and not the date when the municipality actually sends out the invoice.

\https://www.irs.gov/newsroom/irs-advisory-prepaid-real-property-taxes-may-be-deductible-in-2017-if-a...

Of course. @utsave1  - if you pay that extra quarter for 2018 deduction, you will not have it for 2019 deduction. Consider which year you top out at $10,000.

[Texas Roger]

The poster is filing a 2018 tax return and asked if both a payment in 2018 and a payment in 2019 could be deducted.

[ScruffyCurmudgeon]

The "article" is the link!  but true- did not realize that he had not yet paid.