What Federal Tax Reform Means for Minnesota

Tax Changes Shake Up Salt Deductions

It would be extremely difficult to literally repeal all tax cuts for taxpayers earning more than $100,000 and none going to those earning less than $100,000 since some provisions affect both groups . Jones Walker’s State and Local Tax (“SALT”) Team provides a full range of state and multi-state tax compliance, planning and litigation services that help publicly traded companies, as well as privately held entities, minimize their state and local tax liabilities. Jones Walker’s SALT practice is manned by an experienced and a deep bench of attorneys that represent clients in matters throughout the country that involve practically every type of state or local tax. The SALT Team regularly assists clients with planning, audit defense, litigation and legislation. In fact, Jones Walker’s SALT Team attorneys have significant experience, and success, before administrative tribunals and courts, including the Louisiana Supreme Court.

What is the SALT deduction for New Jersey?

This legislation raises the cap on SALT deductions from $10,000/household to $100,000/single filer and $200,000/married couple. It will fully eliminate the SALT deduction cap for 99% of NJ-11 families and allow residents to deduct an additional $8 billion in state and local taxes over the next three years.

New York legislators continue to introduce bills targeting the digital economy and data collection. On January 18, New York State Senator Liz Krueger , Chair of the Senate Finance Committee, introduced S2012, which imposes a monthly excise tax on for-profit entities collecting and selling data from more than one million New Yorkers per month. The tax would apply regardless of how the data is collected, whether by electronic or other means. In 1986, the Legislature created the Economic Development Zone Act to stimulate private investment and job creation in specific economically challenged areas of the state . Among the tax incentives, the EZ-ITC allowed taxpayers a refund of 50% of its EZ-ITC carryover as a new business, and a 50% refund of its EZ-ITC carryover as the owner of a QUIP or SCIP.

SALT trivia – May 3, 2023

Two—which is the bigger picture consequence—is that with the massive tax overhaul, there may be more newly built condos, but there will be fewer people who can afford them. Such a scenario can shake up the New York real estate industry to a high magnitude, especially since this could continue to add to its high inventory volumes. “If this goes on for a few years, it could knock people out of the box in terms of buying a home, especially if you throw in interest rates possibly rising,” Jonathan Miller of Miller Samuel said with regards to the proposed tax reform bill.

Tax Changes Shake Up Salt Deductions

Legal fees incurred by the party who was ordered to pay alimony were not deductible, unless they were part of “tax advice.” However, under the TCJA, Miscellaneous Itemized Deductions (IRC §67), for tax years 2018 through 2025, have been eliminated. This means there is no ability to deduct legal fees, tax preparation fees, employee business expenses, or investment advisory fees. Legal fees incurred in securing an award of alimony or collecting https://quick-bookkeeping.net/ alimony are no longer deductible. On January 17, 2023,S1845was filed and referred to the Budget and Revenue Committee. The legislation proposes to impose a 5 percent tax on the gross income of every corporation that derives income from the data New York individuals share with such corporations. The bill says little about how the tax will work – and fails to define or use existing defined terms within New York’s franchise tax.

SALT team members to present at TEI, COST Conferences

The LIFT Act is not an expansion of the current federal Earned Income Tax Credit , but rather a complementary policy. Notably, it comes on the heels of a 2017 proposal from Sen. Sherrod Brown and Rep. Ro Khanna to Tax Changes Shake Up Salt Deductions enhance the existing federal EITC. Their proposal, the Grow American Incomes Now Act, would double the maximum credit for working families and increase it nearly six-fold for workers without children in the home.

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