Some prepay Harford property taxes in anticipation of lower 2018 federal deductions

Customers line up in front of the payment window in the Harford County administration building in Bel Air Friday afternoon to pay their end-of-the-year taxes, utility bills and in some cases, prepay next year's property taxes.
Customers line up in front of the payment window in the Harford County administration building in Bel Air Friday afternoon to pay their end-of-the-year taxes, utility bills and in some cases, prepay next year's property taxes. (David Anderson/The Aegis / Baltimore Sun Media Group)

Bel Air resident Bryan Glaz came to the Harford County Administration Center in downtown Bel Air Friday to prepay his next year's property taxes for one reason.

"Because I'm going to get crushed next year by this tax bill," Glaz said, referring to the sweeping federal tax reform bill President Donald Trump signed into law Dec. 22. The legislation affects earnings and deductions beginning Jan. 1, 2018.


Harford property owners such as Glaz, who anticipate being over a new state and local tax deduction cap on their 2018 federal tax returns, had prepaid property taxes on more than 450 accounts by close of business Friday, according to county Treasurer Robert Sandlass.

Taxpayers throughout Maryland, as well as other states with high local taxes such as New York and New Jersey, had been lining up at their county tax offices in the final days of 2017 to prepay their 2018 property taxes in the hope of getting a larger deduction on this year’s federal income tax return before a $10,000 cap on deducting local and state income, property and sales taxes kicks in next year.


Harford County has 96,578 property tax accounts, and taxes were prepaid on 463 of them as of Friday, according to Sandlass. Those were paid in person at the county administration building. More were paid online or in a lockbox, so the final total will be tabulated when the government reopens Tuesday, according to Treasury office staff.

“We certainly have people in line, but it’s not like some of those scenes that you’re seeing in other jurisdictions,” Sandlass said Friday afternoon.

Glaz, a civilian employee at Aberdeen Proving Ground, was one of about 13 people at the first-floor payment center in the county administration building. Most people in line said they were there to pay their 2017 property taxes — due by Dec. 31 — or utility bills.

People could prepay up to the same amount they owed for the current 2017-2018 fiscal year, according to Sandlass. Those tax bills went out by July 1, the start of the fiscal year, and payments could be made Sept. 30 and Dec. 31.


Next year’s property taxes have not been billed yet. The state, which handles property assessments, recently completed its assessment of Harford County properties in the Route 40 corridor. Property owners can now appeal those assessments, and the final amount owed will not be known until the assessment process is completed and the County Council adopts the fiscal year 2019 property tax rate next spring, Sandlass said.

The council kept real property tax rates the same at $0.8937 per $100 of value for owners of property in Aberdeen, Bel Air and Havre de Grace and $1.042 for property outside those municipalities when they adopted the fiscal 2018 budget in May.

The Internal Revenue Service put out an advisory Wednesday, warning that “prepayment of anticipated real property taxes that have not been assessed prior to 2018 are not deductible in 2017.”

Sandlass stressed treasury staff “are not in a position” to tell Harford taxpayers whether their prepayments are deductible or not.

“When it comes down to the final [matter] of deductibility, that’s going to be between them and the IRS,” Sandlass said.

Even if taxpayers cannot deduct their prepayments, they would only owe any amount remaining when next year’s tax bills are sent out, or they would get a refund from the county on an overpayment, according to Sandlass.

Glaz said he expects to pay higher federal taxes in 2018 because he will lose, under the new law, deductions that he has been able to itemize in prior years such as interest payments on his mortgage and state and local expenses.

“The net result for me is a substantial hit,” said Glaz, who hopes he can obtain a larger refund in 2018 and save some money.

He even wrote to his congressman, Rep. Andy Harris, to express his concerns. Harris, a Republican who represents District 1, voted for the tax bill when it was before the U.S. House in November, although he voiced reservations about potential impacts regarding state and local tax payment deductions.

Glaz said he received a “polite letter” from Harris’ office in response, although the congressman’s explanation of his support, based on anticipated benefits for the middle class, “wasn’t satisfactory to me.”

“There are some middle-class taxpayers like me who will not benefit, who will be substantially hurt by this bill,” Glaz said.

Eric Mcdonell, a Bel Air resident and an attorney with the county’s Office of the Public Defender, prepaid a portion of his next year’s property taxes Friday.

He said he made the prepayment based on the advice of his tax preparer, who usually itemizes “pretty much anything” on his federal return, such as mortgage interest.

“The new federal tax bill is out to screw the middle class,” Mcdonell said.

Like Glaz, Mcdonell hopes to save some money with a larger 2017 deduction in anticipation of higher taxes next year.

“I don't buy the fact that they're saying this is the best thing for everybody and this will bring down taxes,” Mcdonell said. “I think it's very short-sighted.”

Mcdonell said he expects services from the federal government, so he does not mind paying “some taxes.”

He expressed frustration about likely Trump Administration efforts to curtail spending, particularly in the wake of the tax reform bill.

“I see government as providing a lot less now [regarding] caring for its citizens,” he said.

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