Gerald purchases a new home on June 30,2013.During January 2014,he receives his real estate tax statement for calendar year 2013 showing $1,800 payable.Gerald pays the $1,800 on March 1,2014.The seller of the residence had credited Gerald with $900 of the 2013 taxes on the closing statement.What is the amount of real estate taxes that Gerald may claim as an itemized deduction in 2014?

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Quizplus · Accepted Answer

Real estate taxes are deductible in the year in which they are paid. In this case, Gerald paid $1,800 on March 1, 2014, for the calendar year 2013. However, he had already been credited with $900 of the 2013 taxes on the closing statement when he purchased the home in June 2013. Therefore, he can only deduct the remaining $900 ($1,800 - $900) as an itemized deduction in 2014.

Gerald Purchases a New Home on June 30,2013