Free Republic

WASHINGTON — The Internal Revenue Service is preparing to crack down on states that try to circumvent a new limit on the state and local tax deduction, saying on Wednesday that it will not allow local governments to find creative ways to help individuals fully deduct those taxes. The I.R.S. warning comes in response to states, like New York, that have looked for ways to blunt the impact of a new $10,000 cap on the state and local tax deduction, known as SALT. The cap, which was included in last year’s $1.5 trillion Republican tax overhaul, hit predominantly Democratic, high-tax...

I’ve noticed that a number of FReepers are having conniptions over the possibility that legislation reducing federal income tax rates will also ELIMINATE ITEMIZED DEDUCTION OF STATE & LOCAL INCOME TAXES (SALT). I have a proposal for the new legislation. Have it give tax payers the CHOICE of 1) still deducting SALT but STILL ALSO using the current (i.e., unreduced) tax rate tables or 2) not deducting SALT but having their taxes computed using the new reduced rates. Having worked in systems development for a number of years, automating that feature could be relatively simple for Intuit (maker of Turbo...