Yesterday (Saturday December 23rd), a picture of my family appeared in the New York Times.

For those of you who still have a print copy laying around, turn to page A19.  Alternatively check out this link.

It all started 12 days ago when I emailed our local tax collector in Westchester to ask about pre-paying our 2018 property taxes.  Like many residents of New York, the recent GOP tax bill will effectively raise our taxes because the bill eliminates the ability to deduct state and local taxes from our federal taxable income.  As the world now knows (since it was published in the article), my family pays $21k per year in property tax – so losing the ability to deduct that from our federal taxes is pretty significant (on the order of $5k-$6k per year).  If we can pre-pay our 2018 property taxes in 2017 under current law (and deduct that payment from our 2017 federal taxes) – it would save us some money.

Sending the email to our local tax collector was really one of my first personal interactions with the government.  That is, of course, outside of the normal stuff like getting a passport or driver’s license.  Up until now, I haven’t really had any reason to contact the government.  I suppose I’ve lived a very fortunate life – this recent tax bill is really the first piece of legislation that has impacted me and my family on a direct and personal basis.

I did a quick internet search for who the tax collector for my town was and sent an email to Edye McCarthy (Assessor for the town of Greenburgh – which is technically where the Village of Tarrytown is located – where I live).  The email was short, just two lines.  I listed my address and asked very courtly if we could pre-pay our 2018 taxes now.

When I sent the email, I wasn’t really expecting much of a response.  To be honest, I wasn’t even sure if the email was going to go to Edye directly or if it was going to be redirected to some sort of government customer service center where I might get an automated response or have a to wait a few days to hear back.  In my head, I was expecting an experience similar to contacting Verizon or AT&T customer service.

To my surprise, I got an immediate response directly from Edye, who put me in touch with someone named Paul Feiner, the supervisor for the Town of Greenburgh.  For those of you, like me, who are really fascinated by New York local government structures – you can read this very informative Wikipedia page – for everyone else: Town Supervisor is like the CEO of our town.

I emailed a handful of times with Paul and honestly am extremely impressed with him.  I emailed him nights, weekends, mornings – and looking back, there wasn’t a single instance where it took him more than a few hours to respond to my email and he often responded in less than 10 minutes.

As it turns out, it wasn’t originally possible for us to pre-pay property taxes because the town needed something called a warrant before they could collect taxes.  The 2018 warrant for the town of Greenburgh wouldn’t be ready until April 2018 at the earliest.

However, Paul didn’t give up.  He relentlessly petitioned Governor Cuomo’s office to allow for pre-payment before a warrant is issued and he also helped me get in touch with the reporter from the New York Times to amplify our message.

All in all, it looks like we made an impact.  The article about my family ran yesterday with quotes from Paul as well as Governor Cuomo and (largely due to Paul’s effort), Governor Cuomo passed emergency legislation on Friday that allows home owners like me to pre pay our taxes.

Amazing.

Two weeks ago, I didn’t even know who our local government representatives were, much less how to contact them.  Today I’m someone who successfully helped (in a small way) change the law to save a lot of people a lot of money.

I think the world would be a better place if we all contacted our local government representatives more often to speak our minds.  I certainty will be.

 

My Picture in the New York Times and My First Significant Encounter with the Government
  • Joe D.

    Well it seems that this (prepayment) won’t work unless the taxes have already been assessed (see https://www.cnbc.com/2017/12/27/irs-says-2018-property-taxes-are-deductible-if-assessed-and-paid-in-2017.html). I’m not sure when the “assessment event” occurs. If it’s the date that the taxes are due then you’re out of luck. If it’s considered to be an annual event then pre-payment will save you money as you hope.

    Bringing forward deductions and postponing income is an age old tax reduction strategy. You probably would’ve gotten some (admittedly much smaller) benefit doing this at the end of the year all along.

    I’m curious though. How do you feel about corporate tax inversions?

  • Seems that it varies town to town. Greenburgh (the town where Tarrytown is located) is collecting prepayment for a portion of taxes: http://www.greenburghny.com/Cit-e-Access/news/index.cfm?NID=45355&TID=10&jump2=0

    I haven’t done enough research about the corporate tax cuts to have a well informed opinion. Although, I believe two things are true:

    1) Corporations are already paying fairly low effective tax rates by exploiting loopholes and hiding profits in entities located in Ireland.

    2) Fortune 100 companies are sitting on record cash reserves already.

    Given these two data points- I have trouble seeing how giving them big tax cuts will make them invest more than they already are.

  • Breaking news: IRS just announced that most pre-payments are not deductible. They made this announcement this evening after many people have already pre-paid. What a disaster.

  • Charlie Greenberg

    This is a wake up call to States like New York and California to take stock of why their tax rates are so high and what type of budget reforms & re-allocations can be made. Unlike the Federal Govt, States and Cities need to work within a balanced budget but that does provide free license to have the escalated tax rates that a State like NY has. Cuomo, Shumer and Gillibrand need to collaborate with the Nat’l agenda

  • Charlie- thanks for the comment here. Knowledge gap for me: why are NY and CA taxes so high compared to other states – esp the states that have 0 state income tax? Is it that other states get revenue from other sources (e.g property tax? Corporate tax?) or is it that NY and CA just provide more services so they have greater funding needs?

    Honest question- I haven’t done much research on the topic.

  • Charlie Greenberg

    I’m not overly versed in this area but will say that the tax structure of each of the States in the Union draw from different revenue sources and taxes account for financial obligations which vary by State. Costs for infrastructure, such as transit, union pension obligations and funding for large budget items such as education are big variables. States with lower income taxes oftentimes have higher property taxes, NJ being one of them. Everyone is in favor of lower taxes but when it comes to making the choices of what to give up to afford a lower tax base, the dissension starts. The MSM was hyper critical of Trump’s tax reform but the lowering of the Corporate tax rate puts America on a more competitive playing field. With Nat’l tax reform now signed off, NY politicians should stop bashing President Trump and look at what they can offer in State tax reform. As a NYC resident, I also pay NYC taxes, assume you pay Westchester taxes. In both areas, a voter referendum on reform would be most welcome. Andrew, wishing you and your family a very Happy New Year.

  • Very helpful comments! At this point, state tax reform sounds like a really good idea. Happy new year to you as well.