I know you’re finalizing your Thanksgiving holiday plans, but if over the next few days you find you need a break from the relatives, take it, and look into year-end tax moves.
One popular tax-saving option for homeowners is to pay annual property taxes by Dec. 31, so the amount can be deducted as an itemized expense on Schedule A.
That’s definitely an appealing option for property owners in New York and New Jersey. Counties in those two states tend have the highest property tax burdens in the country, according to a new study.
Using data from the American Community Survey, analysts at the Urban Institute in Washington, D.C., found that property tax burdens vary substantially by region. Property tax rates are especially high in the Northeast and parts of the Midwest, according to the Urban Institute.
At the state and local level, says the D.C. think tank, more tax revenue — around three-fourths of all collections — comes from the property tax.
And as any homeowner can attest, the property tax rate plays a big part in personal finances. The Urban Institute says the tax also affects residential investment and the overall housing sector.
3 property tax options
As a homeowner, you essentially have three options to deal with high property taxes.
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Veteran contributing editor Kay Bell is the author of the book “The Truth About Paying Fewer Taxes” and co-author of the e-book “Future Millionaires’ Guidebook.”