Yardley CPA Posted March 2, 2011 Report Posted March 2, 2011 New client arrives and shows me a tax assessment he received from the State of NJ for 2006 tax year. To make a long story short, NJ assessed him an additional tax of $1,200. In addition to the tax due, there was interesnt and penalties. Client paid total amount of assessment in May of 2010. I believe I can take the tax paid (not the penalty or interest) on this years Schedule A - State & Local Income Taxes, correct? Quote
Pacun Posted March 3, 2011 Report Posted March 3, 2011 Absolutely. That brings a very interesting question. House is repossesed by bank. While tax payer was the owner of the house, real estate taxes accumulated and 3 years later the state charge them. They owned real estate 3 years ago and they pay the tax, can they deduct it in the year paid if no longer own any property? Amount was 12K. Quote
grandmabee Posted March 3, 2011 Report Posted March 3, 2011 If they are leagaly liable to pay it and they pay it then its deductable Quote
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