Q. Can I deduct out-of-state property taxes on a summer-only cottage my New Jersey tax return? TurboTax shows yes, but I’ve seen conflicting information. I just want to do the right thing.— Taxpayer
A. The new tax plan changed the way property taxes can be deducted.
Property tax is deductible on all homes for federal purposes, said Bernie Kiely, a certified financial planner and certified public accountant with Kiely Capital Management in Morristown.
But now, they are subject to the $10,000 limit on state and local taxes.
After the feds limited those taxes to $10,000, New Jersey took some steps to increase what you can deduct for your state return, but not for a second home.
For New Jersey purposes, you can deduct up to $15,000 for your primary residence in New Jersey, Kiely said.
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Karin Price Mueller writes the Bamboozled column for NJ Advance Media and is the founder of NJMoneyHelp.com. Follow NJMoneyHelp on Twitter @NJMoneyHelp. Find NJMoneyHelp on Facebook. Sign up for NJMoneyHelp.com’s weekly e-newsletter.