New York, New Jersey Homeowners Rush to Prepay Property Taxes

By Joseph De Avila Features Dow Jones Newswires

From Jersey City, N.J., to Oyster Bay, N.Y., residents are hustling to make early property tax payments on their 2018 bills to avoid a hit under the new tax bill passed by Congress.

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"This tax bill has turned things upside down here," said Steven Bellone, county executive of Long Island's Suffolk County. "Tax offices across the county are getting inundated with calls."

The tax bill signed into law Friday by President Donald Trump caps the amount that tax filers can deduct in state and local income, sales and property taxes at $10,000, beginning next year. Many homeowners in New York and New Jersey, however, pay much more than that and could get higher tax bills as a result.

Mark Fogelfis, 64 years old, said he expects to pay more taxes under the new federal law. The Oyster Bay homeowner said he paid about $7,800 in 2018 school and property taxes on Monday that he plans to deduct on his 2017 tax return.

"The new tax bill is terrible. I'm upset," said Mr. Fogelfis, who is retired.

New York Gov. Andrew Cuomo signed an executive order last week that permits municipalities to collect early 2018 property taxes even as partial payments. This will allow tax filers to deduct those levies on their 2017 tax return as long as they make their payments by Jan. 31, according to the governor's office.

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"I will not stand silently by as the federal government launches an economic civil war that used our property taxpayers to subsidize corporations and other states," Mr. Cuomo said in a statement.

Connecticut doesn't allow the prepayment of property taxes.

In New Jersey, homeowners typically can prepay their property taxes for the first and second quarter of the next year. In Jersey City and Hoboken, city officials are allowing residents to prepay for the third and fourth quarter of next year too.

Jersey City Mayor Steven Fulop, a Democrat, said he wanted to make the change "to help minimize the negative impacts our working families will face thanks to the new Republican tax bill."

Most towns in New Jersey have opted not to encourage residents to prepay their property taxes because it is unclear if the Internal Revenue Service will allow tax filers to make this deduction, said Michael J. Darcy, executive director of New Jersey State League of Municipalities. The New Jersey Society of CPAs also cautions that Congress could retroactively disallow prepayment of property taxes.

The IRS didn't return a request for comment.

Several municipalities in Westchester County are allowing homeowners to prepay their 2018 property taxes based on their 2017 bills. But Westchester officials said the county will be unable to calculate the final tax obligations for each of its municipalities before the end of the year.

"There is no way to do this responsibly by the end of the year given all of the laws that the county must follow under Westchester's charter and the U.S. tax code," a spokesman for Westchester county said.

Officials in Nassau County on Long Island are working with local towns to allow the collection of property taxes before Jan. 1, said Chief Deputy County Attorney Lisa LoCurto.

Oyster Bay's tax office on Long Island has extended hours all this week and will be open on Saturday to expedite tax payments, said Joseph Saladino, the town supervisor.

Residents "realize this situation is unfair," Mr. Saladino said, but the change "took place on the national level, not on the local level."

Write to Joseph De Avila at joseph.deavila@wsj.com

From Jersey City, N.J., to Oyster Bay, N.Y., residents are hustling to make early property tax payments on their 2018 bills to avoid a hit under the new tax bill passed by Congress.

"This tax bill has turned things upside down here," said Steven Bellone, county executive of Long Island's Suffolk County. "Tax offices across the county are getting inundated with calls."

The tax bill signed into law Friday by President Donald Trump caps the amount that tax filers can deduct in state and local income, sales and property taxes at $10,000, beginning next year. Many homeowners in New York and New Jersey, however, pay much more than that and could get higher tax bills as a result.

Mark Fogelfis, 64 years old, said he expects to pay more taxes under the new federal law. The Oyster Bay homeowner said he paid about $7,800 in 2018 school and property taxes on Monday that he plans to deduct on his 2017 tax return.

"The new tax bill is terrible. I'm upset," said Mr. Fogelfis, who is retired.

New York Gov. Andrew Cuomo signed an executive order last week that permits municipalities to collect early 2018 property taxes even as partial payments. This will allow tax filers to deduct those levies on their 2017 tax return as long as they make their payments by Dec. 31, according to the governor's office.

"I will not stand silently by as the federal government launches an economic civil war that used our property taxpayers to subsidize corporations and other states," Mr. Cuomo said in a statement.

Connecticut doesn't allow the prepayment of property taxes.

In New Jersey, homeowners typically can prepay their property taxes for the first and second quarter of the next year. In Jersey City and Hoboken, city officials are allowing residents to prepay for the third and fourth quarter of next year too.

Jersey City Mayor Steven Fulop, a Democrat, said he wanted to make the change "to help minimize the negative impacts our working families will face thanks to the new Republican tax bill."

Most towns in New Jersey have opted not to encourage residents to prepay their property taxes because it is unclear if the Internal Revenue Service will allow tax filers to make this deduction, said Michael J. Darcy, executive director of New Jersey State League of Municipalities. The New Jersey Society of CPAs also cautions that Congress could retroactively disallow prepayment of property taxes.

The IRS didn't return a request for comment.

Several municipalities in Westchester County are allowing homeowners to prepay their 2018 property taxes based on their 2017 bills. But Westchester officials said the county will be unable to calculate the final tax obligations for each of its municipalities before the end of the year.

"There is no way to do this responsibly by the end of the year given all of the laws that the county must follow under Westchester's charter and the U.S. tax code," a spokesman for Westchester county said.

Officials in Nassau County on Long Island are working with local towns to allow the collection of property taxes before Jan. 1, said Chief Deputy County Attorney Lisa LoCurto.

Oyster Bay's tax office on Long Island has extended hours all this week and will be open on Saturday to expedite tax payments, said Joseph Saladino, the town supervisor.

Residents "realize this situation is unfair," Mr. Saladino said, but the change "took place on the national level, not on the local level."

Write to Joseph De Avila at joseph.deavila@wsj.com

Corrections & Amplifications

This article was corrected Dec. 27, 2017 at 11:52 a.m. ET because an earlier version misstated the date by which tax filers must prepay their property taxes as Jan. 31 instead of Dec. 31.

New York Gov. Andrew Cuomo signed an executive order that permits municipalities to collect early 2018 property taxes even as partial payments. This will allow tax filers to deduct those levies on their 2017 tax return as long as they make their payments by Dec. 31. "New York, New Jersey Homeowners Rush to Prepay Property Taxes" on Tuesday at 5:49 p.m. ET misstated the date by which tax filers must prepay their property taxes.

(END) Dow Jones Newswires

December 27, 2017 12:06 ET (17:06 GMT)