Experts: No benefit for Texans trying to pay 2018 taxes early
FOX4’s Steve Noviello says there’s no advantage for Texans considering paying their 2018 tax bill in advance of new U.S. tax laws taking effect in the new year.
The idea is to avoid the new $10,000 cap on the deduction, but there are some rules from the IRS which means it makes sense for Texans to hold onto their cash.
In order to qualify for the deduction of 2018's property taxes on your 2017 tax bill, the property taxes need to not only be paid during this calendar year but also assessed during this calendar year -- which in Texas, they are not.
Texas property taxes are assessed during the calendar year for which they are owed.
While many counties are willing to take money early and banks will gladly allow people to overfund their escrow account, because there is no actual assessment for which a person is responsible there is no corresponding deduction for pre-payment -- only for payment of the current year's tax bill.
Basically, if you don't currently owe it you can't currently deduct it.
Of course the best advice if people have questions specific to their situation is to ask their tax accountant.
There is still time to make a tax deductible charitable contribution under the current tax law and the deadline to make contributions for individual retirement accounts which can be used by some tax payers on their 2017 tax return is the April 2018 tax deadline.