Tricks States Can Use to Get Around the SALT Deduction

What’s the story?

The recently-passed tax bill puts a $10,000 cap on state and local tax (SALT) deductions—which is bad news for high-tax states like California, New York, and New Jersey.

But Bloomberg explained that there are a couple of "tricks states may use to get around the SALT deduction."

• Charitable Gifts: Residents could "make charitable gifts to the state instead of paying income tax."

• Replace income tax (paid by individuals) with payroll taxes (levied on employers): "Channeling collections into payroll taxes would also allow both itemizers and non-itemizers to benefit, and states would keep more money within their borders."

What do you think?

Will your SALT deductions be affected by the new tax bill? Would you support states creating workarounds for SALT? Hit Take Action and tell your reps, then share your thoughts below.

Take Action

—Josh Herman

Related Reading

• New Tax Law Means Flurry of Work for Payroll Depts, Accountants and… You?

• Tax Cuts and Jobs Act

(Photo Credit: Aslan Alphan / iStockphoto)