Here's How To Prepay Your Taxes And Potentially Save Big

DuPAGE COUNTY, IL — It's not too late to join the crowds at your county treasurer's office and prepay your property tax bill before the new year. That's when the GOP tax law takes effect. Business Insider reported that many high-end homeowners could be paying more next year because of a new rule that caps state and local tax deductions to $10,000.

As it stands now, there is no limit, which is why the early birds are hoping to effectively delay the new cap another year. Business Insider also said prepaying is a trend especially apparent in areas with higher levels of state and local income taxes like California, New York and Connecticut.

If someone’s property taxes exceed $10,000, they could save by paying next year’s property taxes before the new year. The rule leaves it up to local governments to decide how they'll honor the payments.

The IRS Wednesday issued some guidance about pre-paying and deductions:

The Internal Revenue Service advised tax professionals and taxpayers today that pre-paying 2018 state and local real property taxes in 2017 may be tax deductible under certain circumstances.

The IRS has received a number of questions from the tax community concerning the deductibility of prepaid real property taxes. In general, whether a taxpayer is allowed a deduction for the prepayment of state or local real property taxes in 2017 depends on whether the taxpayer makes the payment in 2017 and the real property taxes are assessed prior to 2018. A prepayment of anticipated real property taxes that have not been assessed prior to 2018 are not deductible in 2017. State or local law determines whether and when a property tax is assessed, which is generally when the taxpayer becomes liable for the property tax imposed.

DUPAGE COUNTY

People can prepay with cash, check, or credit card in person (421 N. County Farm Road in Wheaton), through the mail, or through their online banking system. The treasurer will accept payments up to 105 percent of last year's tax obligation. They must be submitted by 4:30 Dec. 29.

-- Caitlin Ketel, Patch Staff; Image via Shutterstock