With the new tax bill being passed, there are bound to be some changes that will affect you. Most of these changes do not take effect until 2018, but there are a couple planning maneuvers that can be made to save tax dollars in 2017. State taxes, like withholding from your W-2 or your estimated tax payments, are typically a large deduction on most people’s federal return.The new legislation is limiting the deduction for state taxes to $10,000 for years starting in 2018. For this reason, we are recommending that our clients pay all remaining 2017 state liabilities no later than December 31, 2017. Waiting until January to pay fourth quarter estimated payments or April to pay remaining balances for 2017 could cause a loss of the deduction.
Please contact us if you have any questions or concerns.