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Prepay State Property Tax and Interest

CaroKim Consulting, LLC

QUESTION: How does tax principle #10 apply to an individual taxpayer like me?

ANSWER: Prepay state property taxes and interest for an individual taxpayer means that, you make your January 2020 property tax and mortgage interest payment early (prepay state property tax and mortgage interest). Mortgage bill includes property tax – ESCROW, no need for two separate payments. Paying your mortgage lender by the end of the year, ensures that we can deduct this interest on your 2019 tax return. In turn, this will help us itemize your taxes instead of using the standard deduction. This interest deduction may also be used as a home office business deduction.

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ACTION PLAN: Make January 2020 mortgage payment by 12/31/2019 and obtain a Form 1098 from your mortgage institution. Doing this will ensure that there is consistency between the interest we report to the IRS on your Form 1040 and the interest that the mortgage institution reports in 2019 on your Form 1098. Looking on the bright side, January 2020 mortgage payment will be one less bill to worry about after all the holiday spending: shopping, eating, travelling, gifting and partying…LOL

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Published by CaroKim Consulting, LLC

A certified and seasoned accountant, who can lift your tax, bookkeeping and payroll financial stress. You earned it, I can help you legally keep it. CaroKim Consulting provides individuals and small businesses with tax, bookkeeping and payroll accounting services. CPAs and Tax Accountants working at CkC aim at Lifting Your Financial Stress by; e-filing tax returns timely, accurately and confidentially. Providing clients with insightful financial recommendations, to ensure they lower their tax liability as low as legally possible. Caroline Kimani has a CPA, masters in accounting and over eight years of tax experience. She has previously worked with the IRS Volunteer Income Tax Assistant program, Koch Industries - multi-billion dollar private company, CPA firms, RaceTrac Petroleum and currently works for at a multi-national publicly traded company. Lifting Your Financial Stress

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