Yesterday in a press release the IRS commented on efforts by NY and follow-on efforts by NJ to avoid the new cap on state and local tax (“SALT”) deductions. "Taxpayers should be mindful that federal law controls the proper characterization of payments for federal income tax purposes." Tax reform created a cap of $10,000 for [...]
NJ Governor Phil Murphy signed legislation allowing homeowners to declare property taxes as charitable donations. Local governments can now establish charitable organizations to accept property tax payments. The response is a workaround of the Trump tax cuts that capped the deduction for state and local taxes at $10,000/yr seen by many “blue staters” in NY, [...]
Really enjoyed this graphic: So many applications to life. Knowing what we know, knowing what we don't and knowing there's so much more to learn. It's so important to know where we stand. We are what we are...not what we think we are.
In response to new federal law limiting the deductibility of state and local income and property taxes at a maximum of $10,000 NY has approved a fiscal year 2019 budget containing provisions to lessen the impact. It is important to note these changes do not reduce taxes for NY taxpayers. Instead they shift the burden [...]
Tucked quietly into the Bipartisan Budget Act of 2018 (signed by President Trump on Feb 9th) is the Philanthropic Enterprise Act of 2017. The Act permits private foundations to own for-profit businesses if certain requirements are met. The Act inserts into subsection (g) of §4943 of the Internal Revenue Code new language that defines six [...]
Unmitigated gall. Nothing else can explain the hypocrisy. On the heels of the grandstanding announcement to put Wall St execs in prison (“coincidentally” timed for the 10-year anniversary of the Bear Stearns collapse) The Commonwealth of Massachusetts – home to the outspoken Elizabeth Warren – announced a program to fund housing down payments with taxpayer [...]
...the IRS wants you to know they may not be deductible after all.
This chart does a nice job showing the prior laws, the competing Senate/House proposals for change and how things were resolved during the reconciliation process to create the new laws to go into effect beginning in 2018. Missing from the chart is discussion of the changes to §529s. Previously distributions in order to qualify for [...]
Takeaways from the above: more than half of American households own no stock roughly 1/3 maintain indirect ownership and with the rise in passive strategies (i.e. indexing) have endowed giants like Vanguard with enormous voting power over corporations Now consider the following: 60% of American families combined own less than 2% of stock wealth [...]
Both the House and Senate passed Bills to reform the Internal Revenue Code. Here's how they stack up as they had into the reconciliation process: