Pay your property taxes early to avoid new law? You can get a refund in Tarrant County | Fort Worth Star-Telegram

Homeowners who tried to prepay their 2018 property taxes to avoid a financial hit from the pre-Christmas federal tax overhaul — only to be rejected by the IRS — can now get their money back.

Tarrant County Tax Assessor-Collector Ron Wright said Thursday that his office would begin issuing refunds to any residents who prepaid their taxes before Dec. 31, and who now wish to have their money returned.

Requests must be in writing, either via email or by visiting a tax office in person and filling out a form. Requests should include the full names of the property owners and the account number shown on documents from the Tarrant County tax office.

“We realize they made that payment in good faith. We accepted it in good faith. And we will refund it in good faith,” Wright said.

Wright’s office and tax offices nationwide began allowing residents to prepay their 2018 property taxes just before Christmas after Congress passed a federal income tax overhaul and President Trump promptly signed it into law.

Under one of the changes in federal law, taxpayers may no longer deduct state and local property taxes over $10,000 from their federal income taxes.

At the time, Wright said his office would accept early payments but would make “no judgment as to whether that is acceptable or not to the IRS.”

And sure enough, less than a week later the Internal Revenue Service released a statement that essentially rejected prepaying of taxes in most instances.

The IRS determined determined that “whether a taxpayer is allowed a deduction for the prepayment of state or local real property taxes in 2017 depends on whether the taxpayer makes the payment in 2017 and the real property taxes are assessed prior to 2018. A prepayment of anticipated real property taxes that have not been assessed prior to 2018 are not deductible in 2017.”

Wright didn’t have the exact number of people tried to prepay the taxes, but said it was hundreds of homeowners in Tarrant County.

“We were flooded with phone calls from taxpayers, preparers and agents wanting to do this,” he said.

Those who wish to let the tax office hang onto the funds and have them applied to their 2018 taxes when bills are sent out in the fall can do so — but the tax office won’t pay interest on the balance, Wright said.

Typically, property taxes are due Jan. 31 of each year. That means residents who haven’t paid their 2017 property taxes have a little more than three weeks to get it done.

The Tarrant Appraisal District typically appraises homes in the first few months of each year and sends out estimated appraisals in April. Homeowners then have a chance to protest any changes in the taxable value of their homes before final appraisal notices are sent out in July.

Local governments then must set their budgets and tax rates for the year, a process that usually concludes in August ahead of the end of the fiscal year Sept. 30.

Then, the Tarrant County tax office sends out its tax notices in October.

This report includes information from the Star-Telegram archives.