texas lawdog wrote: ↑
Thu Dec 06, 2018 6:14 pm
They probably only allowed prepay because of the pending changes in tax law and were ovewhelmed by customers trying to do the same.
If the tax has not yet been assessed, then no amount of prepayment is going to be deductible under the revised IRS guidance.
Some counties accepted prepayments in 2017 waiting for IRS guidance and then had to turn around and refund because they were not deductible.
You can do a quick search for the updated IRS Advisory issued Dec 27, 2017.
Thanks for mentioning the IRS advisory
. It's interesting (to me anyway) that the date on that advisory is the same date as the email from the OH Tax Commissioner's chief counsel to the county treasurer's association that the OP has posted (the OP sent me a PM of the date/time stamped email).
Here's the relevant part of the chief counsel's email:
Chief Counsel, Ohio Department of Taxation wrote:Any prepayment system under R.C. 321.45 must receive the prior approval of the Tax Commissioner before implementation by a County Treasurer. Because said section is expressly limited to the prepayment of “current taxes” only, no payments may be accepted until after the tax lien attaches to the property on January 1 of the current year. In other words, taxes for 2018 that are normally paid in 2019 may be prepaid on or after 2018 lien attaches on January 1, 2018, and not during the remainder of 2017. The same logic applies for tax years beyond 2018.
Just to try to clarify/recap:
In my OH county, prepayments have been allowed for >15 years and the assessed amount (exact amount of tax to be due in February) was nearly always known in the last week of December. I have made and deducted such payments every two years in December since 2001. I paid my assessed taxes in 2017 on the morning of 12/27, about 6 hours before the email was sent by the chief counsel.
The chief counsel seems to be saying (though IANAL) that only "current" taxes can be prepaid (per ORC 321.45
) via agreement between a treasurer and a taxpayer and that taxes aren't "current" until the tax lien attaches to the property on Jan 1. As best I can tell he hasn't given a legal basis for that particular definition of "current". I don't see anything in 321.45 that defines "current". This all seems a bit strange to me because if I sell my house on 12/28 I am certain that I am legally liable for taxes on my property from 1/1 - 12/28.
I haven't yet asked my county what they will do this year, but wouldn't be surprised if they are no longer accepting late December prepayments, based on the email from the chief counsel. Just like the OP's county.
My county does not have an escrow payment system like that of Hamilton County. Even if it did, I would personally be concerned that those payments would not be federally deductible, given that they would be estimated payments and therefore not deductible according to the IRS guidance you mentioned. Kenkat, are you reading this?
Based on the chief counsel email and the response from the Warren County treasurer, I think the OP has zero chance of making a federally deductible tax payment on his property this month. Given the past that may not seem fair, but as the saying goes, you can't fight city hall.
Edited to add quote from chief counsel.