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

SEC bars ex-broker who sold clients phony private equity fund
SEC bars ex-broker who sold clients phony private equity fund

Rajesh Markan earlier this year pleaded guilty to one count of criminal fraud related to his sale of fake investments to 10 clients totaling $2.9 million.

The key to attracting and retaining the next generation of advisors? Client-focused training
The key to attracting and retaining the next generation of advisors? Client-focused training

From building trust to steering through emotions and responding to client challenges, new advisors need human skills to shape the future of the advice industry.

Chuck Roberts, ex-star at Stifel, barred from the securities industry
Chuck Roberts, ex-star at Stifel, barred from the securities industry

"The outcome is correct, but it's disappointing that FINRA had ample opportunity to investigate the merits of clients' allegations in these claims, including the testimony in the three investor arbitrations with hearings," Jeff Erez, a plaintiff's attorney representing a large portion of the Stifel clients, said.

SEC to weigh ‘innovation exception’ tied to crypto, Atkins says
SEC to weigh ‘innovation exception’ tied to crypto, Atkins says

Chair also praised the passage of stablecoin legislation this week.

Brooklyn-based Maridea snaps up former LPL affiliate to expand in the Midwest
Brooklyn-based Maridea snaps up former LPL affiliate to expand in the Midwest

Maridea Wealth Management's deal in Chicago, Illinois is its first after securing a strategic investment in April.

SPONSORED How advisors can build for high-net-worth complexity

Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.

SPONSORED RILAs bring stability, growth during volatile markets

Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.