The new tax law may have lowered rates.
But it also axed or pared back many breaks.
Case in point…state and local tax deductions.
The write-off is now capped at $10,000. In the past, the SALT deduction was generally unlimited for individuals, except for people who owed the AMT. Under the new law, filers can deduct on Schedule A any combination of state and local property taxes, and income or sales taxes, up to a total $10,000 limit. Married couples who file separate federal tax returns can’t deduct $10,000 apiece. Each takes up to $5,000. Property and sales taxes remain fully deductible for individuals in a business or for-profit activity, so taxes paid on rental realty can be taken in full on Schedule E, without regard to the cap. Ditto for such taxes paid by farmers and the self-employed.