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Professional Resources

Tax Cuts and Jobs Act

CPAs’ professional bandwidth is broad, while to many their hallmark remains tax practice. It’s the one specialty that reliably touches virtually every U.S. citizen. Appropriately, taxpayers and financial professionals seek out CPAs for guidance on the ever-growing complexities of tax law.

In 2018, those complexities have reached heights not seen in decades. The Tax Cuts and Jobs Act (TCJA) is the most sweeping change in federal tax law since 1986, unleashing extensive changes to federal tax rules along with significant implications for New York and other states’ tax systems.

This page offers a wide range of resources – NYSSCPA thought leadership initiatives to support CPAs as they research and retool, analysis of federal tax practice changes under the TCJA, unpacking of implications for New York State tax law and efficacy of responsive proposals, offering targeted Continuing Professional Education to blend expertise with explication, and surveying TCJA news and coverage of NY’s response for perspective and insight.

 
Thought Leadership

The TCJA essentially rewrote the U.S. tax code, and NYSSCPA jumped in to help CPAs study the changes and adapt their practice. We also rallied forces to explore implications for New York State tax law, including the creative and untested state initiatives proposed as workarounds to soften TCJA’s disproportionate impact on New York taxpayers.

NYSSPCA marshaled its organizational resources to support CPAs pivoting their professional braintrust to accommodate the disruptive new federal tax provisions, including:

  • Holding a comprehensive Tax Cuts and Jobs Act Workshop within 30 days of the law’s signing, culling some of the industry’s most prominent practitioners under the stewardship of NYSSCPA member and industry icon Sid Kess, JD, LLM, CPA. 
  • Offering a wide array of Continuing Professional Education (CPE) courses, webinars and self-learning materials.
  • Tracking and contributing to coverage of TCJA news and New York tax law news detailing the law’s provisions, applications and implications, including articles in member publications, media placements for NYSSCPA member experts, tracking of TCJA press coverage, and informational resources such as an “At a Glance” summary of TCJA’s provisions for individual taxpayers.
  • Collecting resources for further TCJA information and New York State tax law information from the federal government, New York State executive and legislative branches, and other sources.

Federal Tax Law 

The TCJA worked its way through Congress with lightning speed. Despite seismic shifts to tax law, many elements were dashed off without the deliberation and debate that clarify details and guide practice implications. From simple withholding schedules to complex accounting applications, the many remaining uncertainties called for the immediate expert input of the CPA profession.

NYSSCPA drew from its dozen specialized tax committees to form an ad hoc committee dedicated to TCJA – to study its provisions, analyze implications and plug knowledge gaps. We also marshaled the broad and deep NYSSCPA member expertise through standing committees such as the New York, Multistate and Local Tax Committee, new CPE curricula, and media commentary.


Informational Resources: TCJA

Section by Section Summary of the TCJA 

Tax Guidance from the Internal Revenue Service                       


News: TCJA

Marital Dissolution Planning After the Tax Cuts and Jobs Act
New York Law Journal
TCJA made important changes in the tax rules for alimony, with a ripple effect throughout the tax law.

Impact on Individuals
The CPA Journal
Detailed summary of key TCJA provisions affecting individuals, including tax brackets, tax rates for owners of pass-through entities, capital gains, Alternate Minimum Tax and deductions.

Impact on Estates & Trusts
The CPA Journal
Internal Revenue Code (IRC) section 641(b) instructs that the taxable income of an estate or trust is to be computed in the same manner as of an individual unless otherwise indicated. Further guidance is anticipated as the IRS begins implementation.

Impact on Qualified Business Income Deduction
The CPA Journal
TCJA introduces a new write-off for owners of partnerships and other pass-through entities, with a 20% deduction for Qualified Business Income. There is much confusion about the provision, although here’s what’s clear so far.

First Look: Impact on Investors
The CPA Journal
While TCJA made sweeping changes to many tax rules, it will take time to determine precisely how they will impact investors, with questions surrounding capital gains, qualified dividends, investment expenses, and estate and gift taxes.

First Look: Impact on Businesses
The CPA Journal
TCJA introduced some big changes for business taxes, including tax rates, deductions and tax credits.

The little-noticed tax change that could affect your return
Market Watch
TCJA eliminates write-offs for miscellaneous itemized expenses that were previously subject to the 2%-of-adjusted-gross-income (AGI) deduction threshold.

2018: A Tough Year for First-Time Buyers
The New York Times,
2018 presents a new set of problems for rookie home buyers: a new tax law whose full effects have yet to be felt on homeowner taxes or property values (NYSSCPA placement featuring member Sheila Brandenberg)

TCJA Will Reduce Taxes Even In High SALT States
Globe Street
Cushman & Wakefield “Tax Reform in High SALT States” report focuses on effects of the Tax Cuts and Jobs Act in New York and California. (NYSSCPA placement featuring member Marc Wieder)

A Sneaky Limit Is Gone For Wealthy Clients' Deductions
Financial Advisor
President Trump's tax reform repealed a long-standing cap on some of your high-net-worth clients’ deductions, and that might benefit clients’ tax situation–if they still itemize deductions (NYSSCPA placement featuring member Patrick Daly)

Are You Withholding Enough Taxes?
AARP Magazine
The Internal Revenue Service has released a new online withholding calculator to help people determine their federal tax liabilities under the Tax Cuts and Jobs Act. (NYSSCPA placement featuring member Barry Kleiman)

Tips for Coping With the Changes in the Tax Code
New York Times
There is no simple answer to “How much do I owe?” because so many factors go into how the law will affect an individual. (NYSSCPA placement featuring member Sid Kess)

Some Home Equity Loans Still Deductible
AARP Magazine
The IRS clarifies that under TCJA, the deduction for interest paid on home equity loans and lines of credit is disallowed only if the money is used for something other than to purchase, build or substantially improve a home. (NYSSCPA placement featuring member John Lieberman)

Confusion Surrounds New Pass-Through Income Deduction
Financial Advisor Magazine
Professionals say the new rules on the Qualified Business Income Deduction, created by TCJA, allowing some taxpayers to deduct 20 percent of income they get from pass-through income, are confusing. (NYSSCPA placement featuring member Patrick Daly)

5 ways to hone retirement plans under new tax regime
CNBC
TCJA changes are biggest for corporate taxpayers, while decreases in individual tax rates are smaller and less certain. (Article featuring interview with NYSSCPA member Ed Slott)

Trusts In The Age Of Trump: Time To Re-Engineer Your Estate Plan
Forbes
TCJA has doubled the amount of wealth you can pass to heirs estate-tax-free--without using any trusts or planning gimmicks, and yet  top trust lawyers are positively giddy. (NYSSCPA placement featuring member Martin Shenkman)

Here are some issues in the tax law that remain foggy
The Real Deal
TCJA is a major boon to the real estate industry, but issues ambiguous including how the 20 percent deductions on pass-through incomes will be calculated in certain cases. (NYSSCPA placement featuring member Amy Rosenthal).

Here’s the Trump Tax Loophole Your Accountant Can Blow Wide Open
Bloomberg
If exploiting a tax loophole is as much an art as a science, then the tax planning profession is poised for a creative renaissance under TCJA. (Article featuring interview with member Eric Hananel)

New tax law raises questions about businesses and individuals
MidHudsonNews.com
Taxpayers are worried about TCJA, and here are some initial impressions about the new tax plan. (Article featuring interview with member Thomas Weddell).

Reform May Ease Sting Of The Alternative Minimum Tax
Financial Advisor Magazine
Your wealthy clients may know the name of the alternative minimum tax (AMT) but not its impact or how it’s about to change under the TCJA. (NYSSCPA placement featuring members Barry Kleiman and Kenneth Burstiner).

Tax overhaul will bring decline in donations, LI charities say
Newsday
Charities are worried because of TCJA’s reduction or elimination of key financial incentives for many individuals earning middle incomes to give to charity. . (Article featuring interview with member Anthony Basile).

New Tax Laws Likely to Increase HNW Investment in Real Estate
National Real Estate Investor
Legal and tax experts say TCJA bestows several benefits that make it more appealing for high net worth investors to buy properties. (Article featuring interview with member Abe Schlisselfeld).

Who can take the new business tax deduction? Even tax experts aren't sure
CNN Money
There are many unanswered questions about the major TCJA business tax break of the 20% Qualified Business Income deduction, which may apply to a smaller percentage of income than anticipated. (NYSSCPA placement featuring member John Lieberman).

OPINION: Local CPAs, attorney weigh in on new tax law
Brooklyn Daily Eagle
CPAs weigh in on TCJA: Dewey Golkin, a trustee of the Brooklyn Bar Association who is both an attorney and a CPA; and CPAs Barry Picker and Edward Torres, members of the Brooklyn-Queens Chapter of the NYSSCPA.. (NYSSCPA placement featuring members Barry Picker and Edward Torres).

Carried Interest May Need to Head Back to Congress
Tax Analysts
It’s unclear if the TCJA’s carried interest provision applies only to C corporations or also to S corps, and the IRS may not be able to fix the guidance oversight if the problem isn’t addressed by Congress in technical corrections. (Reporting from NYSSCPA Taxation of Financial Instruments and Transactions Conference)

Nonprofits brace for economic impact from tax law changes
Westfair Online
Nonprofit leaders are concerned about what TCJA will mean for charities, given the doubling of the standard deduction to $24,000 per couple or $12,000 for a single filer. (Article featuring interview with member Anthony J. Tempesta).

How three different households will fare under the tax bill
CBS This Morning
A look at what the tax situations of several families will mean to their bottom lines in different states and economic brackets under TCJA. (Article featuring interview with member Jeffrey Levine).

Tax Bill Is Great for Accountants — Unless They Have Holiday Plans
New York Times
CPAs are exceedingly busy sorting out TCJA changes for their clients. A look at what  the tax situations of several families will mean to their bottom lines in different states and economic brackets. (Article featuring interview with member Matthew Becker).

Accountants overwhelmed with client requests about the tax bill
CBS News
From New York to Kentucky to Florida, accountants and tax lawyers are fielding a swirl of questions from clients and swapping tips via email in their efforts to fully grasp TCJA’s far-reaching changes.(Article featuring interview with member Gary DuBoff)

Will you win or lose under Trump tax plan? Here are 8 examples.
NJ.com
Many middle-class Americans will get lower taxes under TCJAl, albeit only through 2025, primarily through lowering rates, increasing the standard deduction and doubling the child tax credit. (NYSSCPA placement featuring members Sheila Brandenberg and Barry Kleiman)

The New Tax Bill's Winners and Losers
Consumer Reports
TCJA will increase the national debt by $1.5 trillion, impact most Americans in some way, and affect not only take-home pay but also the cost of healthcare, home and business ownership, having a family, and more. (Article featuring interview with member Robert Charron).

Check your paycheck: You might have a surprise in there
MSN Money (CBS Video Repost)
Many Americans likely saw a bump in their paycheck after Feb 15, as new withholding chats became effective. (NYSSCPA placement featuring member John Lieberman)

Bigger paychecks could have bigger tax bill, experts warn
NBC News
While Americans started seeing a bump in their paychecks, lurking in the extra $50 or $100 is the prospect of a big tax bill come. . (Article featuring interview with member Michele Schlereth).

Make Taxes Great Now!
Financial Advisor Magazine
Whether or not you’re a tax practitioner, it’s critical this tax-preparation season to meet with your clients and prospects. Given TCJA’s magnitude, and others will have the conversation if you don’t initiate it. (NYSSCPA placement featuring member Raymond Heller)

Experts Advise Caution As Tax Cuts Bring Meatier Pay Checks To Many Americans
CBS News York
A new Reuters/IPSOS poll shows two percent of U.S. adults say they received a bump because of the TCJA, with about 90 percent of working Americans with a drop in withholding. (NYSSCPA placement featuring member John Lieberman)

Tax season begins today: What you need to know
Yahoo Finance
While many taxpayers see a slight bump in their paychecks, most of the changes don’t apply to 2017, so there’s no need to worry about them until next tax season. (NYSSCPA placement featuring member John Lieberman)

One way to play the new tax law: Start an LLC
Yahoo Finance
Accountants are coming up with novel strategies to help entrepreneurs slash their taxes, including the Qualified Business Income deduction. However, your taxable income must be below $157,500 if you're single or $315,000 if married and filing jointly, in order to qualify for the full deduction.  . (Article featuring interview with member Jeffrey Levine and Jonah Gruda).

Tax reform and cash management considerations for clients
Accounting Today
Under TCJA, it’s extremely important for businesses to keep their tax advisors in the loop regarding transactions to ensure they are structured in a way that will save money. . (Article featuring interview with NYSSCPA member Iralma Pozo)

New IRS Tables Show How Much to Withhold From Paychecks
AARP Magazine
The 2018 withholding tables reflect the TCJA’s higher standard individual deduction, elimination of personal exemptions and changes in tax rates and brackets, with most Americans getting a bump. . (NYSSCPA placement featuring member Anil Melwani)

That 20 percent tax break for small businesses is no free-for-all. How to navigate
CNBC
Small business owners may benefit from kinder tax treatment under the new law. They should think twice before becoming incorporated. . (Article featuring interview with member Jeffrey Levine).

Best Tax Strategies For Early 2018
Financial Advisor Magazine
Most taxpayers ask the same basic questions: ‘How is this going to impact me? Am I going to save on taxes? (NYSSCPA placement featuring member David Lifson)

Making The Most Of The Property Tax Deduction
Financial Advisor Magazine
Since many high net worth individuals pay more than $10,000 in property tax, expanding deductible taxes to income or sales taxes will not benefit such individuals. (NYSSCPA placement featuring members Barry Kleiman, John Lieberman and Patrick Daly)

3 Year-End Tax Moves Due to the New Tax Bill
NextAvenue.org
TCJA makes regular year-end tax planning even more important,. (NYSSCPA placement featuring member Joseph Buble)

 New York State Tax Law

In New York State, hit particularly hard by provisions like a cap on State and Local Tax (SALT) deductions and mortgage interest deduction limits, the response by Governor Andrew M. Cuomo included groundbreaking tax proposals in his Fiscal Year 2019 Executive Budget that presented their own set of analytical challenges.

The NYSSCPA ad hoc tax committee also delved deeply into the ramifications of TCJA for New York State taxpayers. The committee’s chair was selected as CPA profession’s sole representative on the Governor’s Select Tax Panel for discussing policy options and the technical implications of the proposals.

Informational Resources: New York State Tax Law
New York State Budget Department Weighs in on TCJA

New York State Budget Department Preliminary Report on the Federal Tax Cuts and Jobs Act

Governor Andrew M Cuomo’s FY 2019 Executive Budget

NYS Senate Resolution against Rewriting Tax Code

NYS Assembly One-House Budget

National Conference of State Legislatures study.

 
News: New York Tax Law
New York Law Journal on Cuomo Budget
Governor Cuomo includes an “employer compensation expense tax,” and optional tax to shield New Yorkers from TCJA’s disallowance of deductions for State and Local Taxes (SALT).

Albany considers payroll tax while pay checks get bigger with tax reform: Tax Watch
Lohud.com
Gov. Andrew Cuomo and state legislators are grappling with ways to reform New York’s tax code. The aim is to work around the tax law with such novel ideas as replacing the state income tax with a payroll tax paid by employers. . (Article featuring interview with member Ronald Hegt).

NYers should consider prepaying property taxes, de Blasio says
AmNewYork
Mayor Bill de Blasio encouraged city property owners to prepay their taxes before deduction limits change under TCHA. . (Article featuring interview with member Wayne Berkowitz).

Accountants examine tax impact on New Yorkers
The Daily Gazette
Three things are clear about the TCJA federal tax structure: many New Yorkers will pay more as individuals and less as business owners. . (Article featuring interview with members Neil Goca and James Cole).

Advisors Can Help Clients With Deductions As States Wrangle With SALT
Financial Advisor Magazine
Five Democratic-leaning states—including New York, California and New Jersey, where lawmakers want to legally challenge federal tax reform—are exploring changes that could help compensate for the new $10,000 cap on the SALT deduction. (NYSSCPA placement featuring members Barry Kleiman, Barry Horowitz and John Lieberman)

  

Continuing Professional Education

NYSSCPA offers a broad menu of Continuing Professional Education (CPE) courses, webcasts and self-study materials.

Courses
Tax Cuts and Jobs Act: Impact on Tax Exempt Organization

Tax Cuts & Jobs Act Update

Latest Developments in Not-for-Profit Accounting and Auditing

 Webcasts/Teleconferences
 Implementing TCJA – Comprehensive Update on the Tax Cuts & Jobs Act

 Tax Cuts and Jobs Act Impact on Tax-Exempt Organizations

  

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AT A GLANCE: TCJA IMPACT ON INDIVIDUALS

 A brief overview of TCJA provisions, below, reveals the scope of its potential impact on individual taxpayers. To help NY CPAs and their clients sort out details and implications, NYSSCPA has culled an expert tax committee and sent a representative to the governor’s Tax Panel. We will continue to monitor and inform as developments unfold. 

►Tax Rates and Brackets:

Individuals:

10% →   0 to $9,525
12% →   $9,525 to $38,700
22% →   $38,700 to $82,500
24% →   $82,500 to 157,500
32% →   $157,500 to $200,000
35% →   $200,000 to $500,000
37% →   $500,000 and up

Married Filing Joint:

10% →   0 to $19,050
12% →   $19,050 to $77,400
22% →   $77,400 to $165,000
24% →   $165,000 to $315,000
32% →   $315,000 to $400,000
35% →   $400,000 to $600,000
37% →   $600,000 and up

 ►Capital Gains and Dividends:

 Tax rates for capital gains and qualified dividends remain at 15% and 20%, but the income levels at which the rates apply were changed and will be inflation-adjusted. In 2018, the 15% rate will start at $77,200 for married couples filing jointly and $38,600 for single filers. The 20% rate will start at $479,000 for married joint filers and $425,800 for individuals.

►Alternative Minimum Tax (AMT):

 The AMT remains, but the exemption amounts increase and the thresholds for exemption phase out. Exemption amounts increase from $84,500 to $109,400 for joint-filing married couples and from $54,300 to $70,300 for single filers. The thresholds for phase-out of the exemptions begin at $1,000,000 for married joint filers and $500,000 for individuals.

Standard Deduction and Personal Exemption:

The standard deduction is increased to $24,000 for married couples filing jointly, $18,000 for heads of household, and $12,000 for other individuals. The additional standard deduction for elderly and blind taxpayers was not changed.

The personal exemption has been repealed through 2025. Withholding rules will be modified to account for the elimination of personal exemptions.

►Itemized Deductions:

State and Local Taxes – now limited to $10,000 (income, property and sales tax combined).

Mortgage Interest – new mortgage debt eligible for interest deductions capped at $750,000. Interest deduction for home equity loans repealed through 2025.

Medical Expenses – the floor above which out-of-pocket medical expenses can be deducted has been temporarily lowered from 10% to 7.5% for 2017 and 2018. The tax penalty for not having health insurance is eliminated after 2018.

Other – miscellaneous deductions eliminated, casualty losses limited to declared natural disasters.

 ►Pass-through Income Deduction:

A new deduction has been introduced allowing individuals to deduct 20% of “qualified trade or business” income from pass-through entities (S corporations, partnerships, sole proprietorships, Real Estate Investment Trusts (REITs) and Cooperatives). Income that is not eligible includes investment income (interest, dividends, gains and losses from investments) and guaranteed payments to partners. Businesses that are not eligible include accounting, health, law, consulting, athletics, financial services, brokerage services, investment management, and any others where the principal asset is the reputation or skill of one or more of its employees; except for households with taxable income below $157,500 for single filers and $315,000 for married couples filing jointly. Architecture and engineering are deemed qualified businesses, and so can take the new deduction. 

 ►Child tax credit:

The act has increased the amount of the child tax credit to $2,000 per qualifying child. The maximum refundable amount of the credit is $1,400. Phase-out does not begin until $400,000 for couples, up from $110,000.

►Education:

Sec. 529 plans have been modified with the expansion of eligible uses to certain private elementary and secondary educational institutions.

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