New Jersey CPAs concerned about tax legislation
More than 70 percent of 861 CPAs polled in December by the New Jersey Society of CPAs predicted their individual and family clients in New Jersey would face increased taxes due to the Republican tax plans from both the House and the Senate.
Both the Senate Republican plan, which passed on Dec. 2, and the House Republican plan, which passed last month, called for the elimination of state and local tax deductions. Both tax reform plans would also cap the deduction for property taxes at $10,000. Since other differences between the two bills remain, both plans will go to conference to make the two bills compatible.
Nearly 70 percent of the respondents to the NJCPA poll said that “almost all” of their clients currently take state and local income tax deductions. The income groups that would be most affected by the elimination of those deductions would be the $150,000-$325,000 income bracket, according to 53 percent of the survey respondents, followed by the $75,000-$150,000 bracket at 49 percent. Plus, nearly 80 percent of the poll respondents anticipate the net federal tax bill to increase for clients in the $150,000-$325,000 income group.
“High-tax states like New Jersey would feel the bulk of the impact from this plan,” said NJCPA CEO and executive director Ralph Albert Thomas in a statement. “New Jersey businesses and residents should not be forgotten in the midst of tax reform."
On top of that, NJCPA survey respondents indicated elimination of the state and local tax deduction would either “definitely” (40 percent) or “somewhat” (39 percent) influence their advice to clients on whether to leave the Garden State. Only 22 percent said “not at all.”
The complete results of the survey can be found here.