23 August 2018 Proposed regulations would affect all state programs involving charitable contributions and state tax credits, not just those involving $10,000 cap on federal deduction for state and local taxes Today, the IRS released much-anticipated proposed regulations (REG-112176-18) on the deductibility of state and local tax payments for federal income tax purposes. The regulations would prevent states from circumventing the $10,000 cap on the federal deduction for state and local taxes for individuals, estates, and trusts, which was recently enacted under the 2017 Tax Cuts and Jobs Act. Additionally, the regulations would likely affect other long-standing state programs involving charitable contributions and state tax credits. Although the $10,000 cap was the root of the guidance, the regulations go further by also eliminating the benefit to corporations when there was no such deduction cap. A Tax Alert on the proposed regulations is forthcoming. Document ID: 2018-9020 |
