Prepaying 2018 Property Taxes

You can not do it. I believe it got explicitly excluded in the latest text of the bill.

I'm not sure there's a general rule. Depends entirely on your income (and what type it is), current and 'new' tax rate, property tax amounts, other deductions, and where you are in relation to the AMT thresholds. If you have a tax package that lets you do hypotheticals (i.e., have access to a professional system), you could do some what ifs.

If you're feeling obsessive, you will also want to factor in the opportunity cost of the prepayment, as that money could have been earning interest or capital gains during the period it was waiting around to be paid out in 2018.

I'd rather spend the time fixing the system that got us to this place.

My understang is you can only prepay fourth quarter 2017.

Will defer to the experts here (great overview guide btw on taxes in nyc currently: https://www.hauseit.com/nyc-real-estate-taxes/) but imo the new tax reform will allow you to prepay 2018 property taxes.

However, that might not be feasible for a lot of folks because their taxes are paid by their mortgage lender automatically from proceeds in escrow...

Cannot prepay SALT. I believe you can prepay some property taxes, depending on the location.

I just got a note from my accountant (he focuses on real estate clients) saying that it may be a good idea to prepay Q4 state income taxes before year end, and pay more if you're self employed and you think you may owe more when Apr 15th comes. As it should be deductible under the new law...

@ 300_mercer: you are incorrect i think, some attorneys have noted that the legislation is poorly worded and might not technically prevent you from taking a deduction. The law will forbid prepayment for state income taxes, but not for property taxes. So a prepayment on or before Dec. 31, 2017, of a 2018 property-tax installment is apparently OK. The window of opportunity for prepaying real estate taxes closes next week. If you itemize, doing so could save you big money on your federal tax bill this year. If you pay more than that and itemize your taxes, it makes sense to try to pay as much and local tax bill before 2018, when you can still use the old rules to take a larger deduction.

Nicole
www.nestapple.com

300 Mercer is correct. I spoke to my accountant about doing it and the law Cleary prohibits it. Don’t play this game.

If you have been assessed and manhattan condo owners have been assessed you can prepay the 2018 1st and 2nd quarter property tax bill prior to the end of the year. Co-op owners are unable to.
If you owe a state 4th quarter estimated payment (normally due Jan. 16th) you can also prepay it prior to the end of the year.

almost forgot if you are in the AMT do not prepay the 4th quarter estimated tax

From 12/22 Daily News:

http://www.nydailynews.com/news/politics/cuomo-letting-new-yorkers-pay-2018-property-taxes-advance-article-1.3715937

For NYS, it will next be up to local governments and school districts to decide if pre-payments will be permitted. Check with Department of Taxation and Finance for further assistance.

Spent an hour going through my taxes (never really bothered to care before), but for those that are already subject to AMT, prepaying 2018 property tax increases your AMT. So a hard no for those under AMT, unless I am missing something.

According to this article from today, a spokeswoman for the NYC Department of Finance
indicated that property owners can pay property taxes in 2017 that are normally due in January or April 2018.

Also, in the same article, an accountant suggests that, although the IRS has yet to officially decide whether prepaid 2018 taxes can be deducted on 2017 income tax returns, he thinks it is probably permissible as the law expressly prohibits the prepayment of 2018 SALT payments with no mention of real estate taxes. Makes sense to get a second or third opinion on this IMO.

https://patch.com/new-york/new-york-city/nyc-residents-can-pay-2018-property-taxes-early-city-says

Prepaying makes sense if you don't currently pay AMT. If you are, AMT backs out deductions so it really doesn't matter.

Does anyone know how to pre-pay property taxes if you live in a co-op?

The NY times and the IRS has provided some guidance on this issue although its far from definitive:

https://www.nytimes.com/2017/12/27/business/prepaying-your-property-taxes-irs-cautions-it-might-not-pay-off.html?hp&action=click&pgtype=Homepage&clickSource=story-heading&module=first-column-region&region=top-news&WT.nav=top-news&_r=0

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

https://www.washingtonpost.com/local/dc-politics/tax-bill-spawns-new-holiday-ritual-waiting-in-line-to-pay-taxes/2017/12/27/1e7ea59a-eb12-11e7-b698-91d4e35920a3_story.html?utm_term=.5226b253db21

just make sure you aren't restricted by the A.M.T.