How Do You Deduct Property Tax Payments?

Although the United States does not have Federal property tax, your State, local, and municipal governments may be willing to impose them. Fortunately, you can deduct these as operating expenses.

The amount you will have to pay in property tax each year generally depends on the value of your home and the state in which you live. In practical terms, consider thousands of dollars a year as an average estimate. The availability of a tax deduction will only compensate a fraction of the full cost, so always check whether you are being overcharged. Your state should allow you to appeal the assessment within a certain period, which is worth pursuing if the assessment is demonstrably incorrect.

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Unfortunately, you cannot always count on your property tax assessment to decrease when the value of the property itself does.