People line up at the Town of Hempstead tax receiver’s office in New York to pay their real estate taxes before the end of the year, hoping for one last chance to take advantage of a major tax deduction before it is wiped out in the new year. In Hempstead, town Tax Receiver Donald Clavin said “thousands” of people packed his office Tuesday trying to pay their 2018 property and school taxes a year in advance. (Howard Schnapp/Newsday)
Ever since Congress passed its overhaul of the nation’s tax code, Clark County Treasurer Doug Lasher’s staff has increasingly fielded calls from people wanting to pay their 2018 property taxes before a new limit on local deductions kicks in.
Those callers get a disappointing answer. Lasher says his hand’s are tied under state law and that his office can’t take early payments.
The new tax law, which was signed by President Donald Trump on Friday, places a new limit of $10,000 on deductions for state and local sales and property taxes. That’s caused concern among some residents of Washington, and elsewhere, that they’ll end up with a higher federal tax bill.
Lasher said that his office has received phone calls from taxpayers wanting to prepay their 2018 property tax bill so they can take the full deduction before the new law goes into place.
“If someone sent in a check, we would return it, because we have nowhere to apply it,” said Lasher.
Lasher said that before his office can begin accepting tax payments, local jurisdictions need to submit their budgets to the County Assessor’s Office. He said that information is used to create tax rolls in January, and bills are mailed out the following month. When property tax money comes in, it is directed toward “buckets of money” for specific purposes (i.e. school districts), said Lasher.
“We would have to put a program in place to take in the money that has no place to be accounted for yet,” he said.
In response to inquiries from tax professionals, the Internal Revenue Service sent out a press release stating that, in general, prepaid property taxes may be deductible if they are assessed and paid prior to 2018.
But Beverly Crichfield, spokeswoman with the Washington Department of Revenue, said the department agrees with Lasher’s reading of the law and that tax payments can’t be received until tax rolls are completed.
Lasher said that taking prepayments would require a “major reprogramming” of property taxes by the state Legislature. He said that doing so would likely benefit less than 1 percent of taxpayers.
Fred Elledge, a financial adviser in Vancouver, said he called up the treasurer’s office about prepaying his 2018 property taxes. He said that his last property tax bill was $11,000 and that he was disappointed to find out from the treasurer’s office he wouldn’t be able to claim the deductions under the old tax structure.
“I would love to be able to write that off this year if I could,” said Elledge. “It ain’t gonna happen.”
When asked what taxpayers could do to lighten their bill, Lasher suggested giving to charity.
“There’s really not much in terms of property taxes that I could suggest,” he said.
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