Standard Irs Deduction 2008
June 29th, 2009Question: IRS guideline on property tax. Can I deduct 2 years of property taxes in the same year?
I currently do not have an escrow account.
My Itemized Deductions each year are shrinking and are fast approaching the standard deduction allowed by the IRS.
IF I pay my 2007 property taxes in Jan. 2008 and my 2008 property taxes in December of 2008. Can I deduct the sum of both on my 2008 Federal tax return?
Answer: Sounds like you are talking about personal income tax and not business income tax, and if I am correct the answer is Maybe.
The key to the answer is –will all your deductions on Schedule A exceed the standardized deduction for your filing status. In 2006 it was $7,500 for single and married filing separate, $10, 300 for married filing jointly, and $7,550 for head of household. So if all your home interest, state and local taxes and charity gifts, misc. deductions, casualty/theft losses, and medical(limited amount deductible) does not exceed the standardized deduction, with the property tax payments all two years, you can consider it not deductible–because you want to take the largest deduction. Schedule A or the standard. Also, if your total itemized deductions exceed $150,500(75,750 if filling married separate), the deduction maybe limited. So there is a low and high range at which you fit into to take advantage of paying both years of property taxes in a single year.
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