2006-12-28 02:30:10 · 7 answers · asked by Ladybug 3 in Business & Finance ➔ Taxes ➔ United States
No, there is not a huge tax break. You may deduct the amount of the taxes in the year they are paid. Generally speaking, property taxes are billed to you in December, but are not due untill February of the next year. For example, you are billed for 2005 property tax in Dec. 2005 you pay it in Feb of 2006. Then you get billed for 2006 in Dec 2006 and pay it in Dec 2006 you will get two years property tax deduction in one year.
That is the only "huge" tax deduction you may take regarding this issue.
2006-12-28 04:00:47 · answer #1 · answered by Dave 3 · 0⤊ 0⤋
The break you could receive in paying your property tax installment now rather than after Monday is in deducting that amount on your Schedule A.
Make sure, though, that you're not deducting too much in local property tax to trigger the AMT.
Our town switched from biannual to quarterly property tax payments. To make the switch, not only did we pay our annual tax, we also paid two more quarters in the same year. 1.5 yrs of tax in one year. That plus our AGI triggered the AMT for 2005. Wasn't a tremendous difference ($50), but I was surprised to learn that I was considered a high income-earner.
2006-12-28 05:56:20 · answer #2 · answered by CMass Stan 6 · 0⤊ 0⤋
Property taxes can be deducted on Schedule A in the year that they are paid.
We pay the winter tax in Dec one year and in Jan the following year (ex. Dec 06 and Jan 08) so we get both in one year but neither in the opposite. It should be part of your overall tax plan!
Remember Schedule A is of no use if the total doesn't exceed the standard deduction.
2006-12-28 02:43:21 · answer #3 · answered by azohawk 3 · 1⤊ 0⤋
Are you itemizing this 12 months? I itemize another 12 months so i'm paying my sources taxes in 2008 (Jan for 2007 and Dec for 2008). If I paid my sources taxes each 12 months, i could slightly have the skill to itemize and could get much less decrease back over the two 12 months era.
2016-10-19 02:15:12 · answer #4 · answered by ? 4 · 0⤊ 0⤋
Well, not huge. But if you pay next year's property taxes before the end of 2006, you can deduct them from this year's return if you itemize. If you're going to itemize next year also, then it doesn't save you much of anything, except for getting the money earlier, in this year's return.
If you're not going to be itemizing next year, then you'd save these property taxes times your tax bracket - if you're in the 15% bracket and your taxes are $4000, then you'd save $600.
2006-12-28 09:31:02 · answer #5 · answered by Judy 7 · 0⤊ 0⤋
If u are filling your tax return as a single & if your deductiions of Schedule A which are like your property tax . Mortgage interest ,
Chrity given in 2006 .If this all exceeds 5,000then it is advisable to pay property tax.
If u r filling jointly then your limit is 10,000
2006-12-28 02:53:24 · answer #6 · answered by us tax 1 · 0⤊ 0⤋
you could probably take a look at last years taxes if you did them yourself and still have the booklet just take a look at the chart in the 1040 book (starts on page 63) and see what difference your tax would be with that much of a reduced income. even if you wait to pay them you will still get the savings just a year later
2006-12-28 02:45:03 · answer #7 · answered by Aviator1013 4 · 0⤊ 0⤋