Update---NYS MAY ALLOW CHARITABLE DEDUCTIONS OF PROPERTY TAXES --HOWEVER, DETAILS HAVE TO BE WORKED OUT. IRS HASN’T ISSUED A RULING
THERE WILL BE ADDITIONAL COSTS TO TOWN SINCE NEW SOFTWARE MAY HAVE TO BE PURCHASED, ADDITIONAL STAFF WILL HAVE TO BE HIRED
AM ASKING NYS TO REIMBURSE LOCAL GOVERNMENTS FOR ALL COSTS
The NYS Legislature and Governor approved a budget on April 1 that may allow residents to get around the federal law that limits tax deductions by creating the ability for residents to make a charitable donation to schools and local governments in lieu of their tax bills. Charitable donations are tax deductible. I am pleased that the Governor and NYS Legislators are thinking out of the box -trying to come up with creative ways to help taxpayers who no long will get tax deductions off of their property tax bills. Although this initiative was approved by state lawmakers, local governments currently are not going to get any reimbursement from NYS to implement the initiative. And so far we have not received updates from the state re: implementation. Those details are being worked out. So you won’t be able to get a charitable deduction for the April town/county/fire district taxes that must be paid by the end of April (have already received some calls from residents about that).
I have written to the Governor’s office asking for a briefing on the details of the law. And, am in contact with other municipal officials – some who are questioning whether the IRS will allow the deduction. I will keep you informed.
I have also written to ask that the state absorb the extra costs associated with implementing this new initiative. Municipal tax collectors will have to purchase new software, hire additional staff. We are all attempting to comply with the tax cap to keep property taxes (already the highest in the nation) as low as possible. When we add staff to our payrolls it makes it harder to comply with the tax cap and property taxes increase --which is not what NYS leaders want.
As reported by David Wilson in his column, some municipal officials from around the region are hesitant about implementing an initiative that the IRS might not authorize --and which could be litigated. I believe that if NYS would absorb the costs, there would not be any risks for local officials --and that this initiative could be much more successful around the state. More communities would give the concept a chance to work. There would then be no excuse for any local official not to implement this initiative and to offer their residents this option.
Westchester taxes are the highest in the nation. If the new legislation works and if this kind of charitable deduction is allowed it could offer taxpayers some needed relief.
Greenburgh, NY Town Supervisor
914 438 1343
link to story highlighting concerns that some local officials in the area have been raising