Effective for the tax year 2008 (and now 2009 with the bailout bill), taxpayers who normally do not itemize deductions because their mortgage interest and other deductions do not exceed the standard deduction will get a little tax relief from payment of their property taxes.
Specifically a single taxpayer gets an additional standard deduction amount of $500 ($1000 for married filers) as long as their property tax payment exceeds the deduction amount.
Seems to me that people who rent rather than own should also be entitled to a similar deduction. After all, part of their rent payment is certainly paying the owner of the property for the underlying property tax cost.
But I don’t make the tax laws, I just try to make sense out of them. And sometimes that is impossible.
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11:40 am on February 5th, 20091
Does this apply when you pay your property taxes through your escrow account?
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admin Reply:
February 5th, 2009 at 12:07 pm
yes, paying your taxes through an escrow account is the same as paying them yourself.
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5:07 pm on February 9th, 20092
[...] New Property Tax Deduction for Non-itemizers (cpajohn.com) Filed under: Deductions, Individual Tags: Itemized deduction, Property tax, Standard deduction, Tax, Tax deduction [...]
6:44 pm on March 3rd, 20093
Can all who live in Los Angeles take this deduction?
I called the IRS..they told me to look at Publication 17 that said ..”You can deduct these taxes only if they are based
on the assessed value of the real property and charged uniformly against all property under the jurisdiction of the taxing authority”
They could not tell me yes or no.
So, I live in Los Angeles-can I take this deduction?
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admin Reply:
March 3rd, 2009 at 8:15 pm
As long as the property tax is based on an assessed value by the county or other jurisdiction and uses an established tax rate within the applicable jurisdiction, the taxes qualify as a property tax deduction.
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12:11 pm on April 3rd, 20094
Which form do you take this deduction on if you use the standard deduction?
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John Reply:
April 3rd, 2009 at 12:33 pm
The deduction is added to the standard deduction on page 2 of the Form 1040.
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10:23 am on November 17th, 20095
hi john,
you mentioned: “and now 2009 with the bailout bill”. just to be clear, does this mean i can claim this for 2009 also? additionally, does this qualify for an ammendment if i missed it last year?
thanks
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Jim Reply:
February 12th, 2010 at 2:38 pm
@Ben,
will the over $1000 property tax from ’08 carry over to ’09? I goofed and didn’t pay ’09 until Jan 2010.
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John Reply:
February 12th, 2010 at 3:29 pm
@Jim,
The additional standard deduction from payment of property taxes applies to 2008 and 2009. I am not finding where it has been extended beyond 2009 although that could still happen.
You can deduct up to $1000 (If married) of property taxes paid during the year. It does not matter what property tax year is being paid.
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James Reply:
March 4th, 2010 at 2:12 pm
Hey Jim, I filed my taxes through Freetaxusa.com and then realized I am eligible for a $1,000 credit for property taxes and am filing an amended return but they are only now giving me another $150 refund – though it was $500 for single and $1,000 for married as long as the property taxes are more than this. Well mine are $3,700 so why am I not getting the full $1,000 as married?
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