When to pay house tax bill?

[BillGates]

My wife and I bought our first house at the end of April this year. Our 2006 taxes are due in full at the end of January 2007, or in 2 payments, one at the end of January and the other in June or July 2007. We are not doing escrow, rather keeping the money in an account earning some interest. There is no additional charge to make the 2 smaller payments versus the one big one. We have the money to pay the taxes.

Is there any benefit for us to pay the taxes before the end of this year (ie, tax breaks, larger income tax refunds, etc) or should we just pay one payment in Jan. and keep the remainder in savings until June/July?

 

[waggy]

look on the tax bill it will say.

personally i like the escrow account. pay monthly and don't worry about it.

 

[BillGates]

I don't think you read my post.

 

[iamwiz82]

You probably won't get as much benefit this year as compared to next unless you paid points. Compare your deductions now to standard deduction.

 

[chowderhead]

you have to run the numbers. You have to pay the taxes before the end of this year for it be counted for this year's taxes. Paying it in January and June would count for next year. If you didn't pay a lot of interest on the mortgage since you closed in April, you may want to consider paying all the property tax this year to decrease your net income assuming you itemize.

 

[waggy]

true i didnt just read the title and skimmed the rest heh
. is there a benifit? yes if you pay taxes for next year now you can use it as a deduction. though not 100% sure if it wo uld be worth it the first year.

 

[EagleKeeper]

If you will come under the Schedule A limits for 2006; push the the payments to 2007.

Also, if the income level in 2007 will be a higher tax braket; then also consider using the tax payments in 2007