IRS admits non-ad valorem *real* property taxes are deductible

- R
- Rich Carreiro
  
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posted
12 years ago

Wed, Apr 18, 2012 1:55 PM

The CA FTB has been trying to ding people for deducting non-ad valorem real property taxes, since CA conforms to IRC 164(a). The FTB finally asked the Chief Counsel for a letter on this and the CC had to admit that the IRC does *not* require real property taxes to be ad valorem to be deductible (though the IRC does require that of personal property taxes).

The CC also said that revisions to Sched A, etc. instructions will be recommended.

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And the FTB letter that prompted this:

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- P
- Pico Rico
  
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posted
12 years ago

Wed, Apr 18, 2012 3:27 PM

yes, and MTM had this all figured out months ago!

- R
- removeps-groups
  
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posted
12 years ago

Wed, Apr 18, 2012 7:11 PM

That's fair enough, but it is possible that FTB does not have to conform to federal law on this. That is, Schedule 540-CA may have an adjustment to itemized deductions, reflecting the fact that federal does allow ad volorem taxes but CA does not.

- B
- Bill Brown
  
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posted
12 years ago

Wed, Apr 18, 2012 10:45 PM

Interesting and useful, Rich. Thanks.

- A
- Alan
  
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posted
12 years ago

Thu, Apr 19, 2012 12:48 AM

federal law on this. That is, Schedule 540-CA may have an adjustment to itemized deductions, reflecting the fact that federal does allow ad volorem taxes but CA does not.