4 ms·
Can someone help me out here? Last year I paid 5-figure state income taxes (CA) which, as far as I understand, is no longer deductible from my federal income.
by habosa 9y ago
Can someone help me out here? Last year I paid 5-figure state income taxes (CA) which, as far as I understand, is no longer deductible from my federal income. So if my federal income taxes are ~30% then I'd expect to have a $3000+ tax increase from the loss of that deduction.
Yet this tool implies I will get a tax cut.
What elements of the new bills will result in a tax cut large enough to offset the loss of the SALT deduction? I am single, living in CA, no dependents. I do not own a business.
- pkaye 9y agoYour standard deductions will double but your exemptions will be gone.
- kelnos 9y agoAs a sibling noted, your standard deduction will double. That likely isn't enough, so I would guess that juggling the income limits in the different brackets is what made up for the difference. My state income tax paid is more than even the new standard deduction amount, and it showed a tax cut for me as well, so I can only assume the bracket reorg is what did that. In the end, my income & tax situation is more complicated than the simple single slider this calculator gives, so it doesn't really tell me much that is useful.