The Montgomery County Council is doing a second about-face on whether to try to quickly pass legislation enabling residents to prepay their 2018 property taxes, in an effort to lessen the impact of the just-approved GOP tax overhaul.
Two days after saying they would not rush a bill through, the council announced it wouldhold a special legislative session the day after Christmas to consider doing just that.
The will-they-won't-they saga began Dec. 19 when Council Member Roger Berliner (D-Potomac-Bethesda) urged the county to pass a law that would allow homeowners to prepay their 2018 property taxes so they could deduct those taxes in full, before a new cap on deductions takes effect next year.
At the time, Berliner said the council, which has recessed for the holidays, would have to retroactively pass a law in January enabling the county to allow the collection of early payments by the end of 2017. While the District, Fairfax and other jurisdictions in the area allow prepayment of taxes, Montgomery has no such law on its books.
But Berliner’s proposal quickly fizzled, with Council President Hans Riemer (D-At Large), among other lawmakers, noting administrative hassles and legal questions that they said couldn’t be fully worked out by the end of the year.
In an interview Thursday, Riemer said the council would not take action on the issue.
But on Saturday, the council announced they still might have a Christmas present for Montgomery residents eager to prepay their property taxes by Dec. 31 in hopes of deducting those taxes in full. The federal tax overhaul, signed by President Trump on Friday, caps deductions for state, local and property taxes at $10,000.
The council will convene Tuesday to introduce an expedited bill that would authorize the county’s finance department to accept early payments. The session will also include a public hearing, after which Riemer said the council will “act on [the bill] immediately.”
“I think we’re still convinced that it’s not going to be perfect, but I think nevertheless, we can’t let the perfect be the enemy of the good here,” Riemer said in an interview Saturday afternoon. “We’ve heard from our residents and we are responding.”
Riemer said homeowners of all income levels were expressing interest in the prepayment option.
It remains unclear how the council might address the issues that earlier caused lawmakers to pull back on Berliner’s original prepayment proposal.
For example, the council doesn’t set its tax rate until the spring, and actual tax assessments won’t be issued to residents by the end of this year. Officials and tax experts can’t say for certain whether homeowners can prepay and get deductions on property taxes in jurisdictions that haven’t yet sent out tax bills.
Council members were also concerned about the technical challenges of processing and handling the prepayments, as well as sufficiently notifying the public. On Saturday, Riemer — who said he had communicated with each council member about the special session — said there is no way of knowing how many homeowners would try to prepay.
“I’m pretty confident we’ve got the votes,” he said.