If you itemize think about paying your property taxes before Dec 30th

So I was planning to write about how great and walkable Shaw/Truxton Circle is, but I got an email from my ANC that is very time sensitive.

Long story short, in 2018 the tax rules change. There is a limit on local taxes, including local property and income. If you are paying more than $10K in property, income, and whatever passes as a local tax* (look at your 2016 DC tax return for the income part), you may want to pay your property tax early, so it can count with your 2017 taxes.

See the announcement below from The Office of Tax and Revenue https://otr.cfo.dc.gov/release/statement-prepayment-real-property-taxes

Statement on Prepayment of Real Property Taxes
Wednesday, December 20, 2017

The new Federal tax law limits the amount of state and local income and real property taxes that individuals may deduct from their Federal income tax, beginning in calendar year 2018.

Under the new law, the amount that may be deducted is limited to $10,000 of the combined local income and real property taxes.This applies ONLY to taxpayers who itemize their income tax filings.

District property owners may pay their 2018 real property taxes in 2017 to get the full benefit of that deduction in 2017.These payments MUST be received and recorded in calendar year 2017.The payments made will be credited to the calendar year 2018 real property tax obligation.

About 40 percent of District taxpayers itemize their income tax filings.Taxpayers who do not itemize will not receive a tax benefit by paying early.

The Property Tax payment can be made two ways:

  • The District of Columbia Office of Tax and Revenue’s (OTR) website www.taxpayerservicecenter.com provides the opportunity to pay by electronic check (e-check). Click on “Prepay your 2018 Real Property Tax Here” to get to the correct form. The payment MUST be made before midnight December 31, 2017. The information required to make the payment is the property address (or lot and square numbers), your bank routing number and bank account number.
  • Wells Fargo will accept payment by check or credit card at any DISTRICT branch office. Payment MUST be received by close of business on Saturday, December 30. You MUST bring a 2017 real property tax bill to the bank so that they can process the payment. Some Wells Fargo branches are not open on Saturdays.

Do not mail payments as they may not be recorded in 2017.

*So had a fun conversation with a relative who said they deducted some building fee assessed by their version of DCRA as a tax, that and permits. So…. anything the local government charges you that relates to your house….That was a bit more creative thinking than I was willing to do for myself.

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