task0778
Diamond Member
In red states like FL and TX I would agree but in states with major financial exchanges like NY and IL lack of SALT deductions could easily collapse not just the whole state but also adjoining states if the exchanges move to a lower SALT jurisdiction. That is why Cuomo is going to court over that deduction. Barring those two situations the Mortgage deduction cap is going to be the major motor of migration for the next few years.
In 2014 the average SALT deduction in NY was a tad over $21k, and in IL it was a tad under $12.9k. Considering they still get to deduct $10k under the new tax bill, and considering most filers in those and other states don't itemize in the 1st place, aren't you overstating the case for collapse? Illinois is headed for a collapse anyway, no? I find it hard to accept that rich guys in NY are going to have to pay federal taxes on an average of an extra $11k; even at the new top rate of 37% that's still only an extra 4 grand in taxes. And in IL we talking about an extra $1k in more fed taxes, BFD. And I'm pretty sure they'll find ways to lower that amount one way or another.
In short, I really don't think NY, IL, and the adjoining states are going to collapse due to the limit placed on the SALT deductions for federal taxes even if the exchanges moved elsewhere. And Cuomo is grandstanding, he's got no case whatsoever and I'm sure he knows that. Most likely he's thinking about running for president in 2020 and wants to gin up the base. He ain't going to allow the NYSE to leave without a heckuva fight.