New IRS code triggers taxing times
The federal tax code re-write may have given congressional Republicans something to crow about, but state officials said it's triggered taxing times for some Pennsylvanians.
The new tax code that takes effect Monday replaces the current unlimited deduction for payment of state and local income, sales and real estate taxes with a $10,000 cap on the deduction.
State officials Thursday issued a caution to Pennsylvania property owners rushing to pre-pay their 2018 real estate taxes in hopes of reaping a better deal by deducting them in 2017.
Taxpayers attempting to prepay taxes due in 2018 should consult with an accountant or tax professional, Department of Revenue Secretary Dan Hassell and Department of Community and Economic Development Secretary Dennis Davin said.
The two cautioned that they are not giving tax advice and cannot say whether the IRS will accept a deduction for pre-paid 2018 real estate taxes.
“We encourage every taxpayer to make the best financial decision for their individual situation,” Hassell said. “Having a conversation with the person who prepares your tax return is an important step that can help taxpayers before they make a final determination.
“Changes in federal tax law that take effect January 1, 2018, have caused great concern across Pennsylvania, and rightly so,” Davin said. “It is important that taxpayers do what they can to financially prepare themselves for changes they will see when it comes time to file their federal return in April 2019.”