Morgage Interest Statement & Property Taxes Stated

[zeros]

I had a statement from the client with interest and property taxes paid. The taxes were quite high. In looking into it it turns out to be special assessments included with the actual taxes which I would ordinarily deduct. Do you all take the figure on the statemen as fact or attempt to get the actual property tax statement?

[TAXNJ]

Cancelled

Cancelled Checks or form 1098 if applicable

[Lion]

For many towns, I can find the detailed bills online to see if sewer usage or other non-property tax items were billed and paid with property tax. If paid directly, my clients include their copy of the bill that shows the detail.

[TAXNJ]

Also

For many towns, I can find the detailed bills online to see if sewer usage or other non-property tax items were billed and paid with property tax. If paid directly, my clients include their copy of the bill that shows the detail.

Also client can ask town tax assessor for statement of taxes paid

[taxea]

I get the property tax paid online from the assessors office because my clients give me their tax bill, not their tax payments.

[Lion]

My town stamps the bill with the date, time, amount, tax bill ref #, etc, basically running a cash register receipt right on the bill itself as the taxpayer's receipt. For my clients who mailed a check to the town, I've trained them to write the date, amount, and check # on the bill when they write the check. Some even staple a check copy to the bill. I can look up their payment history online for some area towns, but not all; so the better I can train them the easier it is for me.

[taxea]

there are special rules for special assessments...it may go to basis and not as a deduction.

[Lion]

When you get the detail, you will deduct the taxes that he paid. Penalties and interest are not deductible for a personal home. Neither are usage fees (sewer usage and water usage are common around here). Assessments can be a lot of things, so get their detail. A capital item would add to basis. But, I've seen things labeled assessments that were actually something like water usage prorated based on how many bedrooms in a condo unit, so find out what the assessment was for. Ask your client questions.

[TAXNJ]

Professional

When you get the detail, you will deduct the taxes that he paid. Penalties and interest are not deductible for a personal home. Neither are usage fees (sewer usage and water usage are common around here). Assessments can be a lot of things, so get their detail. A capital item would add to basis. But, I've seen things labeled assessments that were actually something like water usage prorated based on how many bedrooms in a condo unit, so find out what the assessment was for. Ask your client questions.

Yes, A professional preparer should be aware or know to research this issue. Nothing difficult.

Client should provide documentation.

[Burke]

I had a statement from the client with interest and property taxes paid. The taxes were quite high. In looking into it it turns out to be special assessments included with the actual taxes which I would ordinarily deduct. Do you all take the figure on the statemen as fact or attempt to get the actual property tax statement?

Keep in mind the amount must be a legitimate tax (i.e, a percentage based on valuation.) An assessment may be a flat fee for all kinds of things and would not be deductible on the 1040. You need to inquire further.

[TAXNJ]

Ask = answer

My goodness. This should be simple and less than a minute for the answer.


CLIENT To tax assessor:

Question: please provide me a printout of my 2015 real estate taxes paid separate from any assessments and a printout of any special assessments fees (non tax) separate from R/E tax

Tax assessor to client: here is your info

Client to tax assessor: thank you. Did not know it would be that simple and take less than a minute!! My preparer said it would be very involved.

Client to preparer: Here is the printout of info you wanted. That should take $100 off my bill.

Preparer to client: still cost you a $100 more because of the research and writing and review of post replies I had to do for a difficult issue.

[Lion]

$100 because you didn't have all your tax information at once.