Tax law creates confusion and uproar in city halls across America
Source: Politico
Just a week after it was signed, the tax overhaul is already triggering a swift backlash from puzzled taxpayers and officials.
By AARON LORENZO 12/29/2017 05:13 AM EST
Mass confusion is erupting in town halls across the country thanks to the new tax law, as tens of thousands of property owners scramble to pay next years taxes ahead of schedule while the governors of their states and the IRS give conflicting signals about whether thats even allowed.
In the Albany suburb of Bethlehem, N.Y., more than 100 people waited in a gym to pay their property tax bills some of them for over an hour on Thursday before a new federal $10,000 cap on state and local deductions goes into effect Jan. 1. Municipalities on Long Island were preparing to open over the weekend to give taxpayers more time to pay. But the IRS issued an edict Wednesday night saying the early payments could only be deducted on 2017 taxes if they had already been assessed. That threw residents and local government officials into a new round of confusion as everyone scrambled to determine which payments would qualify.
The uncertainty this week could be the first of many misunderstandings to come as new tax rules take effect starting New Years Day. The tax law that President Donald Trump signed Dec. 22, which Congress rushed to pass before the end of the year, is explicit in some of its language, but vague in other areas. It explicitly forbade prepayments of state and local income taxes but was silent on prepayments for state and local property taxes.
What the federal government did and the timing of their actions was, in our view, cruel and unusual, said Steve Acquario, executive director of the New York State Association of Counties. They passed this tax bill at a time of year when government is very much in transition to the next fiscal year. There was great confusion this week.
Read more: https://www.politico.com/story/2017/12/29/tax-law-confusion-city-halls-261371?lo=ap_a1
mainer
(12,029 posts)Imagine the confusion they're going through, and how many angry taxpayers they'll be dealing with.
RKP5637
(67,112 posts)IthinkThereforeIAM
(3,077 posts)... eom.
bucolic_frolic
(43,311 posts)Discretionary enforcement is a tool, and government at all levels are famous for it.
All you need is a little email from some official with jurisdiction and you have a basis for getting away with something.
Zoning is a favorite discretionary tool.
CousinIT
(9,259 posts)Wednesday night, the IRS announced that they will not allow a deduction of property taxes if the taxes have not been billed or assessed. Since 2018 property taxes are generally not billed until July 2018 it appears that a 2017 pre-payment may not be deductible if the IRS holds their position.
Therefore we no longer advise pre-payment prior to year-end.
Since many taxpayers around the country have already pre-paid, it is possible that the IRS may be pressured to revise this stance. We will keep you advised as the situation changes.
33taw
(2,448 posts)turbinetree
(24,720 posts)BumRushDaShow
(129,543 posts)Wait until they find out what else is in that tax giveaway to the 1%.
I know here in Philly many have been pre-paying as they always had the bills sent out before the end of the year and even gave a discount for paying before March.
"Here's it's been assessed, and it's been filled," Breslin said. "All of our respective bills were out weeks ago. Everybody should have a bill in hand."
The city's revenue department will hold regular hours on Friday, enabling homeowners one final business day to submit their prepayments. But homeowners also can mail their prepayments as long as the envelope is postmarked by Dec. 31 or prepay online via the city's website.
"We encourage people to make the payment before Dec. 31.," Breslin said. "If they're up against time, they can take advantage of our electronic payment."
http://www.phillyvoice.com/save-later-philly-homeowners-paying-2018-property-taxes-now/
I expect most of this is done by people who have no mortgage and thus own their own homes (where the taxes would be taken out of the mortgage payments if they had one - at least here).
BigmanPigman
(51,632 posts)I saw it on the local news. Some people are lining up to pay their prop taxes early. I am sure the fucking moron is thrilled that there is trouble in blue states.