With the passage of the most sweeping legislation in decades, tax advisors will be working overtime to figure out strategies for the new year and perhaps the remaining days of 2017.
Republican Governors in New Jersey and Maryland are proposing fixes to the tax code so some residents are not hit with the penalty that occurs when state taxes tend to tied to federal taxes.
At issue are limits to deductions for state and local taxes.
So far, we have not heardanything out of states, like Delaware, with Democratic governors.
The changes coulddrive down revenues over the short term and lead to some difficult decisions. House supporters of the plan say tax cuts will lead to greater economic activity that will put more money into state treasuries.
In the case of Maryland, taxpayers could see hundreds of millions of dollars in higher taxes if current rulesremain in place. Maryland may have some room to maneuver as its fiscal picture appears to be more upbeat than Delaware’s outlook.
Longer term, Delaware could see moreresidents, with property tax break limits perhaps nudging them across the river or state line.
Finally, enjoy your holiday and stay safe, especially when driving during a time filled with joys and distractions.
We werereminded of the dangers faced on the roads every day with the passing of a beloved Newark High School student in a crash earlier in the week. My thoughts goout to her family and friends.
The Business Now newsletter returns on Jan. 2nd. Here’s to a happy holiday and a prosperous New Year. – Doug Rainey, publisher.