RE Tax payment sent in December but posted in Jan

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jdr14
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RE Tax payment sent in December but posted in Jan

Post by jdr14 » Fri Jan 12, 2018 10:38 am

As many people did at the end of 2017, I pre-paid my real estate taxes because of the newly passed tax bill. My town sent out an invoice in the last week of December for the amount due, and was accepting pre-payments. I used BofA billpay to send a check for the tax payment. BofA's site said the check would be delivered no later than December 29th, and in fact they withdrew the funds from my account on December 29th. The tax collector received my payment, but posted the payment to my account on January 2nd.

Can I still deduct the payment on my 2017 tax return?

Gill
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Re: RE Tax payment sent in December but posted in Jan

Post by Gill » Fri Jan 12, 2018 11:13 am

Yes, you can. Date of sending the check determines the date when deductible.
Gill

jebmke
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Re: RE Tax payment sent in December but posted in Jan

Post by jebmke » Fri Jan 12, 2018 11:23 am

I still haven't seen my Q4 state income tax payment clear -- now 18 days since I mailed it. I sent a snarky email to the Comptroller's office about their sloppy cash management practices. In my working days I would have relieved a country controller who let cash sit around this long without depositing it.
When you discover that you are riding a dead horse, the best strategy is to dismount.

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Kenkat
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Re: RE Tax payment sent in December but posted in Jan

Post by Kenkat » Fri Jan 12, 2018 11:33 am

Gill wrote:
Fri Jan 12, 2018 11:13 am
Yes, you can. Date of sending the check determines the date when deductible.
Gill
Agree. I mailed my property taxes 12/29 and they posted 1/4. I will be able to deduct them on my 2017 return because the mail date was in 2017. This will save me close to $1000 so very much worth it.

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samsoes
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Re: RE Tax payment sent in December but posted in Jan

Post by samsoes » Fri Jan 12, 2018 12:01 pm

Gill wrote:
Fri Jan 12, 2018 11:13 am
Yes, you can. Date of sending the check determines the date when deductible.
Gill
Correct. It seems funny that if I drop a tax payment in a mail collection box at 11:59 pm on 12/31, it is considered paid during the old year, even though the mail won't be picked-up until Jan 2. If I wait one minute later to drop the payment into the mail collection box, it's supposed to be considered paid in the new year. Go figure.
"Happiness Is Not My Companion" - Gen. Gouverneur K. Warren. | (Avatar is the statue of Gen. Warren at Little Round Top @ Gettysburg National Military Park.)

libralibra
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Re: RE Tax payment sent in December but posted in Jan

Post by libralibra » Fri Jan 12, 2018 2:04 pm

samsoes wrote:
Fri Jan 12, 2018 12:01 pm
Gill wrote:
Fri Jan 12, 2018 11:13 am
Yes, you can. Date of sending the check determines the date when deductible.
Gill
Correct. It seems funny that if I drop a tax payment in a mail collection box at 11:59 pm on 12/31, it is considered paid during the old year, even though the mail won't be picked-up until Jan 2. If I wait one minute later to drop the payment into the mail collection box, it's supposed to be considered paid in the new year. Go figure.
I think this last part may be wrong. If sending by USPS, the postmark date is what counts. It's also recommended to send registered or certified so that you have proof in case you need it.

clutchied
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Re: RE Tax payment sent in December but posted in Jan

Post by clutchied » Fri Jan 12, 2018 2:08 pm

jdr14 wrote:
Fri Jan 12, 2018 10:38 am
As many people did at the end of 2017, I pre-paid my real estate taxes because of the newly passed tax bill. My town sent out an invoice in the last week of December for the amount due, and was accepting pre-payments. I used BofA billpay to send a check for the tax payment. BofA's site said the check would be delivered no later than December 29th, and in fact they withdrew the funds from my account on December 29th. The tax collector received my payment, but posted the payment to my account on January 2nd.

Can I still deduct the payment on my 2017 tax return?
I did something similar saw it had posted on 1/2/18 and so I called. They said it would reflect on the 2017 statement or whatever.

regardless taxes are always when "paid" so I would probably still deduct it regardless.

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samsoes
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Re: RE Tax payment sent in December but posted in Jan

Post by samsoes » Fri Jan 12, 2018 2:20 pm

libralibra wrote:
Fri Jan 12, 2018 2:04 pm
samsoes wrote:
Fri Jan 12, 2018 12:01 pm
Gill wrote:
Fri Jan 12, 2018 11:13 am
Yes, you can. Date of sending the check determines the date when deductible.
Gill
Correct. It seems funny that if I drop a tax payment in a mail collection box at 11:59 pm on 12/31, it is considered paid during the old year, even though the mail won't be picked-up until Jan 2. If I wait one minute later to drop the payment into the mail collection box, it's supposed to be considered paid in the new year. Go figure.
I think this last part may be wrong. If sending by USPS, the postmark date is what counts. It's also recommended to send registered or certified so that you have proof in case you need it.
An attorney told me once it's when I perform the "last act" I need to perform to pay the bill, using the one-minute before midnight example.

Edit: as a practical matter though, proof of mailing from the USPS will likely carry more weight that your assurance that you mailed the bill a minute before midnight on 12/31.
"Happiness Is Not My Companion" - Gen. Gouverneur K. Warren. | (Avatar is the statue of Gen. Warren at Little Round Top @ Gettysburg National Military Park.)

pshonore
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Re: RE Tax payment sent in December but posted in Jan

Post by pshonore » Fri Jan 12, 2018 2:45 pm

libralibra wrote:
Fri Jan 12, 2018 2:04 pm
samsoes wrote:
Fri Jan 12, 2018 12:01 pm
Gill wrote:
Fri Jan 12, 2018 11:13 am
Yes, you can. Date of sending the check determines the date when deductible.
Gill
Correct. It seems funny that if I drop a tax payment in a mail collection box at 11:59 pm on 12/31, it is considered paid during the old year, even though the mail won't be picked-up until Jan 2. If I wait one minute later to drop the payment into the mail collection box, it's supposed to be considered paid in the new year. Go figure.
I think this last part may be wrong. If sending by USPS, the postmark date is what counts. It's also recommended to send registered or certified so that you have proof in case you need it.
Agree, local tax collector goes by postmark date but that's used to determine if payment was made on time and not subject to late penalty.

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samsoes
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Location: Northeast Rat Race

Re: RE Tax payment sent in December but posted in Jan

Post by samsoes » Fri Jan 12, 2018 7:21 pm

pshonore wrote:
Fri Jan 12, 2018 2:45 pm
libralibra wrote:
Fri Jan 12, 2018 2:04 pm
samsoes wrote:
Fri Jan 12, 2018 12:01 pm
Gill wrote:
Fri Jan 12, 2018 11:13 am
Yes, you can. Date of sending the check determines the date when deductible.
Gill
Correct. It seems funny that if I drop a tax payment in a mail collection box at 11:59 pm on 12/31, it is considered paid during the old year, even though the mail won't be picked-up until Jan 2. If I wait one minute later to drop the payment into the mail collection box, it's supposed to be considered paid in the new year. Go figure.
I think this last part may be wrong. If sending by USPS, the postmark date is what counts. It's also recommended to send registered or certified so that you have proof in case you need it.
Agree, local tax collector goes by postmark date but that's used to determine if payment was made on time and not subject to late penalty.
If that's the Tax Collector's policy for determining on-time payments and late charges, yes. The difficult-to-prove (in an Audit) "last act" minute before midnight mailing is for tax deductiblilty purposes.
"Happiness Is Not My Companion" - Gen. Gouverneur K. Warren. | (Avatar is the statue of Gen. Warren at Little Round Top @ Gettysburg National Military Park.)

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