Should NJ homeowners prepay 2018 property taxes?

Katrina Barker
December 28, 2017

"Because of the recent Federal Tax Reform legislation, many San Luis Obispo County residents are attempting to make advance payments of next year's annual property taxes (for Fiscal Year 2018-19), hoping to take deductions for calendar year 2017 federal and State income taxes".

Counties throughout Southeast Minnesota are reporting a surge in early payments in an effort to cash in - for one final year - on a deduction that the coming federal tax overhaul will limit.

Luzerne County resident Tom Benz wanted to prepay his 2018 real estate taxes this week, but county officials said early payments are not permissible by state law.

Katherine Jordan, an attorney specializing in tax law with Chamberlin Hrdlicka's Philadelphia office, said only property taxes can be prepaid under the new bill, which prohibits prepayment of state and local income taxes.

Hutchinson said responsibility for paying property taxes is handled at the county level.

Some towns aren't allowing residents to pre-pay their 2018 taxes at all, while others are allowing people to partially pre-pay. Proponents of the plan say that a cut in taxes for corporations will allow for greater investments in polyesters and fuel economic growth.

In Chemung and Tompkins counties too, taxpayers must speak with their individual tax collector to determine if prepayment will be accepted. The County does not accept direct tax payments until spring, when bills have reached the delinquent stage.

"It really complicates things", he said, pointing out that the first tax bills are not even generated until the first quarter. But Christie's executive order will mandate that all towns allow at least partial prepayment for 2018. Merton sees politics at play in the new law, since most states with higher taxes tend to vote for Democrats over Republicans.

Benz pays almost half that amount - $4,775 - on local real estate taxes alone for his Foster Township residence and three adjacent land parcels. Respondents ranged in age and income, with the majority between ages 18 and 60 and with incomes of $125,000 or less.The Tax Cuts and Jobs Act - as the bill initially was dubbed - almost doubles the standard deduction for individuals, eliminates some itemized tax deductions, and reduces the State and Local Tax Deduction (SALT), among other things.

Before you get too far, make sure your municipality will allow it. "I don't have one resident with taxes above $10,000".

"My fun holiday reading is ... going through the bill page by page", she said. By Saturday, Fifer said, the city had received more than $1.6 million in prepayments.

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