Thousands Rush To Prepay Taxes Before New Tax Bill Takes Effect
MINNEAPOLIS (WCCO) -- The new tax overhaul President Donald Trump signed into law last week is causing an unprecedented amount of people to prepay their property taxes.
Taxpayers can deduct certain state and local taxes, like property taxes, on federal tax returns.
But starting Jan. 1, that deduction gets capped at $10,000.
Hennepin County officials tell WCCO that about 1,000 people filed their property taxes early last year.
So far this year, around 5,000 people have filed. They say about 3,000 people did so online and the other 2,000 either did so in person or mailed them in.
Laughter might not be your first reaction to paying taxes, but don't tell that to Cadene Burdick.
"Come May 15 [2018] and Oct. 15 [2018] I'll be feeling a lot better [laughs]!" Burdick said.
She is one of thousands of Hennepin County residents using the last few days of 2017 to pay down next year's property taxes.
"I talked to my tax preparer and she advised me to pay my 2018 taxes early. She didn't give me any real specific reasons, but she just said it's going to be beneficial," she said.
Just because it will work for her does not mean it will for everybody. But certified financial planner Scott Beers, owner of Lottsa Financial Services, feels it is worth a shot.
"If you itemize now and you will not be itemizing next year, then it generally make sense to look at prepaying your property taxes," Beers said. "If however you're subject to alternative minimum tax, then prepaying your taxes this year isn't going to save you any federal income tax. However it will still save you state taxes, and that can make it worthwhile."
Beers says the worst-case scenario is that you simply paid your property taxes early.
"Which isn't a terrible thing, especially with interest rates at one percent," he said.
At the very least, Hennepin County turned on its eCheck system, meaning people can prepay their property taxes online. Ken Rowe, administrative manager for the Hennepin County Tax Division, said doing so has minimized the line for people showing up to pay in person.
"We've also moved our operations down from the sixth floor down to the skyway level so that people don't have to go through weapons screening," Rowe said.
Hennepin County residents can pay in person Thursday and Friday from 8 a.m. to 5:30 p.m. or 9 a.m. to 2 p.m. on Saturday. You can also prepay online.
Ramsey County also offers an online option for paying 2018 property taxes.
