Prepaying Property Taxes? Your Bank May Make You an Audit Risk
- 6 years ago
Prepaying Property Taxes? Your Bank May Make You an Audit Risk
Wells Fargo says it does report property tax payments on Line 10 of the form, which is simply labeled “Other.”
And no, alas, you cannot call the bank up and ask it to add whatever you are paying on your own to what was already sent from the escrow account this year.
Also, here’s an alert for a possible future headache: If you do prepay
and have a mortgage and an escrow account, it may be a hassle (or impossible) to get the bank to adjust the original 2018 property tax payment schedule that it set on your behalf.
Mr. Grewal said homeowners who usually paid their property taxes through an escrow account via their mortgage
servicer could end up facing an audit if they prepaid at their local assessor’s office this time.
Bank of America was fulfilling requests for additional property tax payments from people
who already had property tax bills in hand, but it stopped doing so on Tuesday.
In my colleague Ben Casselman’s article this week on the Internal Revenue Service’s side-eyed guidance for all of the people rushing
to prepay property taxes, he quoted some words of warning from Andy Grewal, a professor of tax law at the University of Iowa.
on their tax forms could differ from what the banks would report on the separate forms they use when reporting mortgage activity to the government.
Wells Fargo says it does report property tax payments on Line 10 of the form, which is simply labeled “Other.”
And no, alas, you cannot call the bank up and ask it to add whatever you are paying on your own to what was already sent from the escrow account this year.
Also, here’s an alert for a possible future headache: If you do prepay
and have a mortgage and an escrow account, it may be a hassle (or impossible) to get the bank to adjust the original 2018 property tax payment schedule that it set on your behalf.
Mr. Grewal said homeowners who usually paid their property taxes through an escrow account via their mortgage
servicer could end up facing an audit if they prepaid at their local assessor’s office this time.
Bank of America was fulfilling requests for additional property tax payments from people
who already had property tax bills in hand, but it stopped doing so on Tuesday.
In my colleague Ben Casselman’s article this week on the Internal Revenue Service’s side-eyed guidance for all of the people rushing
to prepay property taxes, he quoted some words of warning from Andy Grewal, a professor of tax law at the University of Iowa.
on their tax forms could differ from what the banks would report on the separate forms they use when reporting mortgage activity to the government.