State and Local Tax Deductions
On Tuesday, June 11th, the Treasury Department issued final regulations on the “State and Local Tax Deductions” (SALT) mainly aimed at preventing residents from circumventing the cap on these deductions.
The tax law signed in December 2017 capped the SALT deduction at $10,000. This controversial provision lead many politicians in high-tax states to construct “workarounds” from this deduction. These workarounds included converting state and local tax payments to charitable contributions. The intention was to enable the taxpayer to deduct these contributions as a charitable donation, which are not capped under the current law.
Under the final regulations, taxpayers are only able to receive a Federal deduction for charitable contributions that are greater than the amount of tax credits received. For example, if a taxpayer donated $10,000 to a local fund and received an 80% credit of his or her taxes, they could only claim a charitable contribution of $2,000.
These final regulations highlight the importance on tax planning throughout the year to ensure that you have paid an appropriate amount of taxes to avoid penalties and interest, and to make sure you have taken advantage of all tax savings opportunities available.
Please contact our professional staff at any time to discuss your specific situation and devise a plan that works for you. Our experienced professionals and advisors are here to address any questions you may have.
Did You Know?
Our professionals at GCS work with a large number of different industries. Some of these industries include high net worth individuals and families, real estate, not-for-profit organizations, physicians and healthcare organizations, family owned and private business,etc. You can find an extensive list of the industries we work with on our website at: https://www.gcs-cpa.com/
Meet Our Team
Steven Panagi is a Director at Gramkow, Carnevale Seifert & Co., LLC and has been practicing as a CPA since November 1989 when he was licensed by the State University of New York. He is graduate of Dominican College at Blauvelt, New York with a B.S. in Accounting in 1987. He is a member of the American Institute of Certified Public Accountants and the New York State Society of Certified Public Accountants. He has been with GCS since 2013. Before joining GCS, Steven has held various positions in public accounting. He was a Senior Manager with a 75 person CPA firm in NYC. Prior to that he was a partner at a 12 person CPA firm in Bergen County, NJ for about 10 years.
Steven’s clients include high net worth individuals, medical practices, real estate, manufacturing, and other service oriented businesses. He is a trusted advisor to numerous closely held and small to medium sized businesses. Steven provides a high level of knowledge across a broad spectrum of areas in general accounting and taxation, tax planning, tax matters resolution, financial planning, retirement and Social Security planning areas.
While not in the office Steve enjoys, salt water fishing and spending time with his wife and three children.