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Payroll Today

Salt and pepper on agenda at IRS hearing on SALT regs

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Alice Gilman

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in Payroll Today

Nonprofits still jammed over parking benefits

The IRS held a hearing Nov. 5 on the proposed regulations that would implement the Tax Cuts and Jobs Act’s $10,000 cap on state and local tax deductions—so-called SALT deductions. The proposed regs have not gone over well with states, and surprisingly, it’s not just “blue states” such as New York, New Jersey and Connecticut that object.

Here’s our semi-regular feature updating the TCJA.

Proposed SALT regs

Some states (we’re looking at you New York and New Jersey) enacted laws that allow residents to skirt the SALT limitation by making charitable contributions to public funds in virtually the same amount as their state taxes. Donors receive a state tax credit in the amount of their contributions.

The advantage: Charitable contributions are still 100% deductible on a 1040.

The proposed regs would shut that down, by requiring taxpayers to reduce their federal ded...(register to read more)

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