The recent 2018 tax legislation passed in Washington includes a significant change to itemized deductions. In 2018, the itemized deduction for income tax paid and for property tax paid is limited to $10,000. As such you may benefit by accelerating the payment of your 2018 property taxes into 2017.
How can you benefit? If you are itemizing deductions, and you are not subject to the Alternative Minimum Tax, combining your 2017 and 2018 property taxes in 2017 will increase your tax year 2017 itemized deductions. Even though this will likely lower your 2018 itemized deductions, you will still receive the full benefit of the new legislation for 2018, by meeting the new $10,000 limit with the income tax that you are paying to Minnesota.
You will need to pay your 2018 property tax by December 31, 2017 to receive this benefit. We’ll be happy to walk you through the specifics of your returns – please call with your questions.