Juan and Dorothy purchase a new residence on May 1, 2018. Juan and Dorothy pay the full amount of the 2018 property taxes of $7,200 on their new house when the taxes became due in December of 2018. What amount of the taxes that Juan and Dorothy pay in December 2018 can they deduct on their 2018 tax return?

Question

Quizplus · Accepted Answer

Juan and Dorothy can deduct the amount of property tax that applies to the portion of the year they owned the property. Since they bought the property on May 1, 2018, they owned the property for 245 days in 2018. Therefore, they can deduct 245/365 of the $7,200 property taxes they paid, which is $4,800.

Juan and Dorothy Purchase a New Residence on May 1