Texas property tax prepayments subject to new IRS deduction cap

State Sen. Paul Bettencourt says IRS guidelines, released Wednesday, "clearly indicate that Texans would not receive a deduction for prepayment" on 2018 property taxes. State Sen. Paul Bettencourt says IRS guidelines, released Wednesday, "clearly indicate that Texans would not receive a deduction for prepayment" on 2018 property taxes. Photo: Taelor Smith Photo: Taelor Smith Image 1 of / 35 Caption Close Texas property tax prepayments subject to new IRS deduction cap 1 / 35 Back to Gallery

Houstonians who rushed to prepay their 2018 property taxes in hope of receiving a soon-to-expire deduction will still be subject to new rules under the federal tax code overhaul set to take effect next month, per Internal Revenue Service guidelines.

State Sen. Paul Bettencourt, R-Houston, said in a statement Thursday that the IRS guidelines, released Wednesday, "clearly indicate that Texans would not receive a deduction for prepayment." The new tax code caps state and local tax deductions at $10,000.

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"Unfortunately it looks like the IRS canceled the run on property tax prepayments for next year in

Texas," said Bettencourt, a former Harris County tax assessor-collector.

The IRS guidelines allow additional deductions on prepayments only if the 2018 tax value was assessed this year. In Texas, annual property taxes are based on a Jan. 1 appraisal.

"Property appraisals for 2018 really don't get computed until the beginning of the year," said Jack Bennett, spokesman for the Harris County Appraisal District.

In Harris County, which has for years accepted prepayments, the tax assessor's office has seen an uptick in the number of people rushing to pay before the end of the year, said spokesman Mike Lykes.

He added that the office has fielded a flood of phone calls from homeowners seeking clarification on whether prepayments are eligible for the deduction.

"It has made this week a very busy week," he said.