For some, paying property taxes due in April in December could save hundreds
BAKERSFIELD, Calif. (KBAK/KBFX) —
If you're a homeowner who is itemizing your taxes this year, accountants across the country recommend consulting an expert to see whether you may benefit from paying local property taxes early this year.
Most homeowners in Kern County pay their property tax in two installments, one due in December and the other due in April. It's the professionals' opinion that you should pay both before the end of the calendar year.
Why? Changes to the tax code that take effect next year will limit deductions for state and local taxes to $10,000.
If you are a homeowner who is itemizing taxes this year, one of two things will happen next year. You could switch and take the new higher standard deduction instead, meaning that the amount you pay in state and local taxes will have no bearing on your federal tax return.
You could also continue to itemize, but the cap on your state and local taxes makes them less valuable as a deduction. In either case, paying property taxes early and placing that expense on your 2017 return will save you money.
Garro Ellis, a financial adviser for Moneywise Inc. in Bakersfield, urges homeowners to take advantage of the current law and take the deduction now when you have more to gain by doing so.
"If you want that property tax bill to be on this year's itemized return, you'll want to pay it off before Dec. 31," he said. "If you wait until April 22, you're not going to get the write off."