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How the IRS just squashed attempts by New York, New Jersey to work around tax-deduction limit

Source: lohud.com - Jun 13, 2019

The IRS on Tuesday squashed attempts by New York and New Jersey to circumvent the federal cap on the deductibility of state and local taxes, issuing final regulations that bar governments from giving substantial tax credits in exchange for charitable contributions.

The charitable funds, which many local governments set up to provide relief from the $10,000 cap, were seen as a way to help taxpayers in high-tax states. New York’s law allowed counties and municipalities to set up charitable reserve funds that would give tax credits equal to 95% of a contribution.

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Category: General Business