Key tips and advice the working tax pro can use.
Local property tax credit
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17-Mar-2023 7:52am

Many state and counties have property tax credits for seniors, low income, veterans, handicapped home improvements, etc.
How do address client expectations for these?
Taking responsibility for making sure all of these are taken advantage of could be a huge in terms of education (different for each state and county) and completing the applications. It could easily double our required fee.
But remaining silent could result in their falling through the cracks and many clients assume that we are preparing all needed tax forms.
Any ideas?
Thanks!

17-Mar-2023 12:39pm

I tell them it's not part of my practice. I believe I even read that in Illinois you can't charge for this.

19-Mar-2023 7:01am

That's really interesting, Cathy! Do you put that in your engagemeng letter?

19-Mar-2023 3:51pm

Smokeytax wrote:That's really interesting, Cathy! Do you put that in your engagemeng letter?

Nope, I just tell them when they call me about it.

19-Mar-2023 4:17pm

You shouldn't have to disclaim in your engagement letter. It can say that you are preparing federal and state income tax returns. That does not include property tax issues.

In CA, we are sometimes told that filing certain forms with the County crosses into the practice of law. It seems a bit fluid, but that might be another excuse.

20-Mar-2023 9:15am

Thanks Cathy and JAD. Hope your tax seasons are going well.

20-Mar-2023 7:12pm

FYI - I learned within the last month that for Nebraska there is a tax credit on the income tax return that is calculated by how much property tax the taxpayer pays. First state I've seen do that, but others may be out there. Form PTC is what it's called. May be helpful if any of your clients own real estate in Nebraska.

21-Mar-2023 4:16pm

CT and DC do, too, but there are income limits. Hardly anyone in my practice gets a credit.

22-Mar-2023 4:14pm

TheAnswerMan wrote:FYI - I learned within the last month that for Nebraska there is a tax credit on the income tax return that is calculated by how much property tax the taxpayer pays. First state I've seen do that, but others may be out there. Form PTC is what it's called. May be helpful if any of your clients own real estate in Nebraska.


There are several states that do this. Wisconsin also has a property tax credit which is available to renters as well (and it's good logic because, albeit indirectly, renters pay property taxes too)
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