Treasury Deals Final Blow to SALT Deduction Workarounds
- Rules prevent using state tax credits to avoid deduction cap
- Treasury first floated idea to stop the programs last summer
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The Treasury Department dealt the final blow to programs in states like New York and New Jersey designed to help residents circumvent the $10,000 limit on deductions for state and local taxes.
The federal , issued Tuesday, prohibit workarounds that would allow residents to create charitable funds for a variety of programs where donors can get a state tax credit in exchange, effectively removing the state and local tax, or SALT, limitation.