Senator Chuck Schumer is calling on the IRS to allow all New Yorkers who prepaid their 2018 property taxes to apply those taxes to the state and local deductions for 2017.
Thousands of people lined up at town and city halls across the state in the final days of 2017 to pay their property taxes early. That’s because under the new tax law, there is a cap on state and local deductions. Some taxpayers could save extra money by prepaying before the start of 2018.
However, Senator Schumer says December 27 guidance from the IRS suggests that property taxes paid in the calendar year 2017 would not be deductible against federal income taxes in the year they were paid.
Schumer is urging IRS to rescind its recent guidance, saying it is not supported by the law. He also wants clarification that taxpayers are allowed to deduct their prepaid 2018 property taxes to state and local governments in 2017, independent of whether they were assessed in 2017.