You can have your tax break — and beat it, too, say tax experts.
The newly overhauled tax system starts in less than two weeks, but there’s still time to cash in on deductions that will disappear on Jan. 1, they said.
The state and local tax deduction will be capped at $10,000 next year, but homeowners in many areas can prepay their 2018 property taxes before Dec. 31 and claim that payment on their 2017 return.
“Pay real-estate taxes in advance if your county will allow it,” says financial adviser Darryl Rosen of Rose Advisory Group. “If you pay in 2017, you can take that deduction.”
New York City allows you to prepay — but other municipalities may not.
If you pay quarterly state income taxes, get the fourth-quarter payment in by the end of the year — instead of the due date in mid-January, when you won’t be able to claim the deduction, says Anil Melwani of 212 Tax and Accounting Services.
“The saving can be huge,” he said.
“Say someone owes $10,000 for the fourth-quarter estimate and they’re in an average bracket of 35 percent — the difference between paying on Dec. 29 or Jan. 10 could be a saving of $3,500. It’s worth doing even if it means putting it on a credit card or taking a little loan.”
Although charitable contributions will still be tax deductible under the new system, most taxpayers will stop itemizing their deductions next year when the standard deduction doubles to $12,000 for singles and $24,000 for married couples.