Daily Tax Report ®

HILL TAX BRIEFING: SALT Cap Workaround Enacted in New Jersey

Jan. 14, 2020, 11:06 AM

New Jersey Gov. Phil Murphy (D) signed a law yesterday that would give small businesses and partnerships a reprieve from the 2017 tax law’s limit on state and local tax deductions.

Many high tax states have attempted to shield their residents from the $10,000 deduction cap, which was established in the 2017 tax law.

Under the new law (S-3246/A-4807), S corporations, limited liability corporations, and other business partnerships will be able to pay state income tax directly at the entity level, as a business tax—rather than at the partner level, as a personal income tax. The 2017 tax...

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