For Immediate Release: Tuesday, December 26, 2017
Statement of Montgomery County Council President Hans Riemer on Bill that Gives County Residents the Option to Prepay their Property Taxes
ROCKVILLE, Md., Dec. 26, 2017—Today the Montgomery County Council passed Bill 42-17, Property Tax Advance Payment — Authorized, which allows county residents to pay their property taxes in advance.
Council President Riemer’s full statement on today’s vote is below:
At a special holiday session of the Montgomery County Council today we enacted Expedited Bill 42-17 to enable County residents to prepay their 2018 property taxes before the end of 2017.
This bill is a response to the just-enacted federal tax reform act, which upended an historic bargain between the federal government and state and local government -- that people should be able to reduce their federal taxable income by the amount that they pay in state and local taxes. The decision by Republicans in Congress to shred this bargain was a direct attack on blue state communities such as ours, where the cost of living is high.
While some other jurisdictions permit prepayment of property taxes, Maryland law requires the County Council to pass a law before any prepayments can be accepted.
After considering various approaches to address this problem, Council members agreed to meet in a special session where we could have a public hearing and a public vote. Thank you to Councilmembers and staff for making exceptional efforts to participate in today’s discussion.
As we heard today, creating this prepayment option may open the door for many middle class residents in the County to get a final year of benefit from deducting their property taxes. Initial speculation was that only the most affluent could take advantage of this option. But with the benefit of public input, we now know that enabling the prepayment option will be a potential
benefit to thousands of county residents of more average means, since they likely pay more than $10,000 in state and local taxes combined.
Indeed, we have heard from nonprofit employees, retirees, teachers, journalists and self-employed persons who say that the potential benefit is significant enough for them that they will figure out a way to put together prepayment funds.
As I hope everyone knows, the tax advice profession is divided as to what will ultimately be found permissible by the IRS, so every taxpayer will need to carefully measure whether this option is right for them.
On Monday January 22nd, the County Council will receive a briefing on the impact of the Federal tax law on state and county finances. How we will need to adjust state and county taxes without the historic deductions remains to be seen, but, as we are doing today and will do again following that briefing, we must take action to ensure that county taxpayers are protected from increases that might otherwise result from the federal tax law’s domino effect.
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Release ID: 17-398