As a consequence of recent changes in the way state and local property taxes may be allowable as deductions in the federal tax code, taxpayers have approached city officials about “prepaying” taxes during calendar year 2017 for tax obligations that will come due in calendar year 2018 or beyond.
A press release from the city of Bristol said tax collectors have authority to collect when they have been issued a tax warrant and a rate bill. Unless and until they have these documents, they have no authority to collect. That means tax collectors do not have the authority to collect “prepayments” of taxes that will come due in July 2018 and beyond.
“The city does have the authority to collect the January 1, 2018 installment during December 2017, because we do have a signed rate bill and tax warrant,” stated Mayor Ellen Zoppo-Sassu in the press releease. “Taxpayers are welcome to make those payments now. By law, that entire tax came due on July 1, 2017, and the installments are merely a convenience for the taxpayer.” (Some towns, such as Westport, bill quarterly, and are accepting January 2018 and April 2018 installment payments for that reason.) The tax collector’s office is committed to being as helpful as possible to taxpayers wishing to pay their January 1, 2018 tax installments during the last days of calendar year 2017. All of the city’s property tax information is available on line on the city website, WWW.BRISTOLCT.GOV.”
“City officials have performed due diligence and consulted with the Connecticut Tax Collectors’ Association, the Connecticut Association of Municipal Attorneys, the Government Finance Officers’ Association, Connecticut Tax Collectors’ Association Certification program instructors, and other public officials with knowledge of state law. The Connecticut Tax Collectors’ Association has an opinion from its corporation counsel advising that there is no state statute that exists which authorizes tax collectors to accept prepayment of July 2018 tax installments at this time, and that doing so would conflict with state law. This opinion further advised that municipalities need to evaluate the risk of accepting such prepayments when doing so could be considered an effort to evade federal income tax liability,” stated Tax Collector Teresa Babon in the city’s press release. “Accordingly, accepting these prepayments is not only contrary to state law and improper not only from a tax collecting perspective, but also contrary to generally accepted cash management and internal control procedures. “
For these reasons, the press release said, the city of Bristol Tax Collector’s Office will not be accepting “prepayments” toward July 2018 and future tax installments until a rate bill is signed in May 2018.