Property tax deduction when filing separate returns


Q. I am married and filing separately to be able to claim the pension exclusion. My question concerns the deduction for property taxes. When filing separately, can my wife and I claim half of the property tax deduction?
— Homeowner

A. Yes.

Joint property is owned, by definition, by both spouses.

When spouses file separate federal tax returns, the deduction can be allocated between them, said Michael Karu, a certified public accountant with Levine, Jacobs & Co. in Livingston.

He said each spouse is limited to a maximum of $5,000 for all of his/her state and local taxes – the SALT deduction – under the new tax plan.

For your New Jersey state taxes, Karu said, when a property is jointly owned, if separate returns are filed, each can only claim up to half of the property taxes.

“For example, if two sisters own a house together but only one had income during the year, she would be limited to taking 50 percent of the real estate taxes as a deduction on her New Jersey tax return,” Karu said.

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This story was originally published on April 24, 2019. presents certain general financial planning principles and advice, but should never be viewed as a substitute for obtaining advice from a personal professional advisor who understands your unique individual circumstances.