After reading a CNN story where New York Governor Andrew Cuomo declared, “the GOP tax bill will pillage blue states<\/em>“, I felt compelled to share some facts about our tax system. This coming tax season will be my 32nd. I’ve been studying and working with our tax code for 32 years.<\/p>\n The anonymous examples I’m about to share involve real-life taxpayers who had $1,900,000 of income in 2016. I have to use\u00a0 high-income earners because the SALT (State And Local Tax) deduction won’t affect the average taxpayer and certainly won’t affect lower income people. A simple fact that the honorable New York Governor fails to acknowledge.<\/p>\n In 2016, the Alabama client with $1.9 million of income paid $561,276 federal income tax and $44,219 to the State of Alabama.<\/p>\n In 2016, the New York client with the same $1.9 million of income paid $503,278 federal income tax, $127,516 New York State Tax and $71,928 New York City Resident Tax.<\/p>\n What are the important observations here? First, the New York resident paid ($57,998) less Federal Income Tax than the Alabama taxpayer! Why? Because he got a federal tax deduction for his SALT of $199,444. This has been this way for years.<\/p>\n Has anyone ever seen the Governor of Alabama on TV raising mortal heck about this?<\/p>\n <\/p><\/blockquote>\n In 2018, we expect the Alabama client to pay $525,276 in federal income tax and $46,019 to the State of Alabama. Note the inverse relationship between state and federal taxes. As the Alabama resident’s federal tax bill goes down, his state tax bill goes up. Why? Because the State of Alabama allows a deduction for federal taxes paid (New York does not).<\/p>\n In 2018, we expect the New York client to pay $537,372\u00a0federal income tax, $127,516 New York State Tax and $71,928 New York City Resident Tax.<\/p>\n Stop your belly-aching. It will take 83 YEARS for your New York Resident just to catch up the $1 million that the Alabama taxpayer has already paid-in over and above the New York resident.<\/p>\n","protected":false},"excerpt":{"rendered":" A tale of two states with two very different outcomes. After reading a CNN story where New York Governor Andrew Cuomo declared, “the GOP tax bill will pillage blue states“, I felt compelled to share some facts about our tax system. This coming tax season will be my 32nd. I’ve been studying and working with […]<\/p>\n","protected":false},"author":1,"featured_media":2248,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"apple_news_api_created_at":"2017-12-28T18:02:49Z","apple_news_api_id":"24a2ac9d-04bd-4d5e-8f38-76b6c9acf401","apple_news_api_modified_at":"2017-12-29T01:16:06Z","apple_news_api_revision":"AAAAAAAAAAAAAAAAAAAAAQ==","apple_news_api_share_url":"https:\/\/apple.news\/AJKKsnQS9TV6POHa2yaz0AQ","apple_news_cover_media_provider":"image","apple_news_coverimage":0,"apple_news_coverimage_caption":"","apple_news_cover_video_id":0,"apple_news_cover_video_url":"","apple_news_cover_embedwebvideo_url":"","apple_news_is_hidden":"","apple_news_is_paid":"","apple_news_is_preview":"","apple_news_is_sponsored":"","apple_news_maturity_rating":"","apple_news_metadata":"\"\"","apple_news_pullquote":"","apple_news_pullquote_position":"middle","apple_news_slug":"","apple_news_sections":["https:\/\/news-api.apple.com\/sections\/74d71b26-dfe2-3cf6-9b79-55911f8259f1"],"apple_news_suppress_video_url":false,"apple_news_use_image_component":false,"footnotes":""},"categories":[1],"tags":[],"class_list":["post-2246","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news"],"apple_news_notices":[],"_links":{"self":[{"href":"https:\/\/cookco.us\/news\/wp-json\/wp\/v2\/posts\/2246","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/cookco.us\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/cookco.us\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/cookco.us\/news\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/cookco.us\/news\/wp-json\/wp\/v2\/comments?post=2246"}],"version-history":[{"count":0,"href":"https:\/\/cookco.us\/news\/wp-json\/wp\/v2\/posts\/2246\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/cookco.us\/news\/wp-json\/wp\/v2\/media\/2248"}],"wp:attachment":[{"href":"https:\/\/cookco.us\/news\/wp-json\/wp\/v2\/media?parent=2246"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/cookco.us\/news\/wp-json\/wp\/v2\/categories?post=2246"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/cookco.us\/news\/wp-json\/wp\/v2\/tags?post=2246"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}Alabama<\/strong> Client (Under Old Tax Code)<\/h3>\n
New York<\/strong> Client (Under Old Tax Code)<\/h3>\n
So over the course of 17 years, the Alabama guy has paid $1,000,000 more in federal income taxes to the federal government than the New York guy!<\/h2>\n
Alabama<\/strong> Client (Under New Tax Code)<\/h3>\n
New York<\/strong> Client (Under New Tax Code)<\/h3>\n
My Message to New York Governor Andrew Cuomo<\/h3>\n