By Paul Morrone CFP®, CPA/PFS, MSA
The Tax Cuts and Jobs Act which passed at the end of 2017 drew a hard line in the sand regarding the deductibility of certain state and local taxes. The $10k limit has been a bone of contention between many ‘blue’ states that often have higher income and property taxes than states that have historically been deemed ‘red’ states (whose representatives also control the House and Senate – those instrumental in the passage of the Act). This has created tension between state regulators and the federal government and has driven some states to take proactive (but not necessarily effective) action. In an attempt to mitigate the new tax burden on their residents, states have implemented workaround strategies that are now in effect in an attempt to circumvent the SALT deduction caps. The big question is, will it work for you?