Trump tax plan state tax deduction

The new tax plan signed by President Trump , called the Tax Cuts and Jobs Act, instituted a cap on the SALT deduction. What is Donald Trumps tax plan? But a third — the exemption for state and local taxes — wasn’t so lucky. Andrew Cuomo has warned would be a “death blow” for New York.

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The law cut individual and corporate tax rates, doubled the standard deduction and made many other changes both large and small. President Donald Trump ’s tax plan reduced or eliminated several tax deductions , while also increasing the standard deduction significantly. That made it more difficult for taxpayers who usually itemize deductions to write off expenses, such as state and local taxes, mortgage interest and charitable donations. The deduction for married and joint filers increases from $17to $2000. But it would also eliminate a deduction that millions of people – largely high-income earners – in Pennsylvania and New Jersey use to get a break on their state and local taxes.

Read this report in PDF. Go to State -by- State Data. The Trump -GOP tax law will provide most of its benefits to high-income households and foreign investors while raising taxes on many low- and middle-income Americans.

This excess income, which the law assumes to be derived from intangible assets,. The rise in the standard deduction in the Trump tax plan is intended to compensate for the loss of the itemized deductions above. Yet the higher standard deduction also takes the place of personal exemptions. All about the deductions.

For middle-class homeowners, the main points of the Trump administration’s proposal are: A reduction in the number of tax brackets, from seven to three. Tax brackets of percent, percent and percent. Elimination of the deduction for state and local income taxes. Tax Day remains April 1 for one. As far as filling the return, everything is going to be business.

Trump’s tax plan, signed in December, places a limit of $10on combined income, sales or property taxes. Whether the suit will find a receptive audience in the federal courts — or on a conservative-leaning Supreme Court — is an open question. For years, they have characterized virtually any tax cut as a gift to the rich. By proposing to end the deductibility of state and local taxes within a broader tax -reduction plan , Trump has both given to and taken away from the rich, in pursuit of lower taxes for others.

Most taxpayers who itemize can deduct them. So the $10paid to your State provides a $10deduction on your federal tax return. This deduction would save you $5in federal income taxes if you are in the tax bracket.

Eliminating that deduction would save the federal government about $1billion,. A key piece of President-elect Donald Trump ’s campaign tax plan was a cap on itemized deductions. The proposal, which would bar singles from deducting more than $100and limit couples to deductions of no more than $2000 would raise more than $trillion over a decade.

Under Trump tax plan , would you still deduct mortgage interest ? Trump campaigned on a plan to increase the standard deduction.