11 Nov Will my ANCHOR property tax benefit be taxed?
Q. I know the ANCHOR property tax payouts are not taxed by New Jersey but what about on my federal tax return?
A. We’re glad you’re asking.
The new ANCHOR property tax benefit is bringing up a lot of questions.
The ANCHOR funds are a reduction of your real estate taxes, said Michael Karu, a certified public accountant with Levine, Jacobs & Co. in Livingston.
He said it’s not shown as income.
“For example, if your real estate taxes are $12,500 and you received $500 as the ANCHOR payment, you would reduce the real estate tax deduction by the ANCHOR amount, resulting in $12,000,” he said. “Since the federal limit for SALT — State and Local Taxes — is limited to $10,000, in this example, it would have no effect.”
Also, if you do not itemize your deductions, it also would have no effect, he added.
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This story was originally published on Nov. 11, 2022.
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