SALT cap will affect nearly 10.9 million people

SALT cap will affect nearly 10.9 million people
Treasury inspector general estimates those taxpayers have a total of $323 billion in state and local tax bills they won't be able to deduct.
FEB 26, 2019
By  Bloomberg
About 10.9 million people are losing out on one of their most prized tax breaks — the deduction for state and local taxes. That's the number of people the U.S. Treasury inspector general for tax administration estimates had tax bills above the $10,000 deduction cap included in the 2017 tax overhaul. The law limited the amount of state and local taxes — or SALT — that taxpayers can write off, a change most acutely felt in high-tax states including New York, New Jersey, Maryland and California, where tax bills can easily exceed the threshold. (More: Limited deduction rubs SALT into taxpayer wounds) These taxpayers collectively have $323 billion in state and local tax bills that can't be deducted, according to the report released Tuesday. The limitation has caused a series of bill introductions in Congress from New York and New Jersey lawmakers seeking to reinstate the full SALT deduction. The report comes as taxpayers are in the middle of filing their returns to the IRS for the first time under the new tax law. In addition to the SALT deduction limit, many taxpayers are also finding that their refunds are smaller than anticipated because of changes in withholding throughout the year. President Donald J. Trump met with New York Gov. Andrew Cuomo earlier this month about revising the SALT cap. Mr. Trump earlier this month had said he was "open to talking about" changes to the provision, but offered no assurances he would back any SALT changes. Eight governors have formed a coalition to fight the SALT cap, but the outlook in Congress isn't favorable. Senate Republicans have already said they will not revisit the issue. (More: New tax laws invite strategic sidestepping)

Latest News

Autopilot surges to $750M AUM, touts RIA growth as users copy Pelosi, Buffett trades
Autopilot surges to $750M AUM, touts RIA growth as users copy Pelosi, Buffett trades

With $750 million in assets and plans to hire a RIA Growth Lead, Autopilot is moving beyond retail to court advisors with separately managed accounts and integrations with RIA custodians such as Schwab and Fidelity.

RIA wrap: Former Procyon advisors launch Third View, ex-Rochdale CEO resurfaces in New York
RIA wrap: Former Procyon advisors launch Third View, ex-Rochdale CEO resurfaces in New York

Elsewhere on the East Coast, a Boca Raton-headquartered shop has acquired a fellow Florida-based RIA in "a natural evolution for both organizations."

$43B Beacon Pointe taps seasoned retirement plan specialist to lead in DFW region
$43B Beacon Pointe taps seasoned retirement plan specialist to lead in DFW region

After advising on nearly $700 million in retirement assets, 27-year veteran Greg Mykytyn is bringing his expertise in ESOP and 401(k) plans to the national RIA in Texas.

Advisor moves: Equitable and Raymond James nab veterans from rival BDs
Advisor moves: Equitable and Raymond James nab veterans from rival BDs

The defectors from Cetera, Lincoln Investments, and DA Davidson strengthen the firms' presence across the Eastern and Western US.

Are you one of the promising wealth management talents under 40?
Are you one of the promising wealth management talents under 40?

InvestmentNews is searching for the country's emerging young talents.

SPONSORED Beyond the dashboard: Making wealth tech human

How intelliflo aims to solve advisors' top tech headaches—without sacrificing the personal touch clients crave

SPONSORED The evolution of private credit

From direct lending to asset-based finance to commercial real estate debt.