can apparently be deducted from your Federal Income Tax.
At least that's my understanding. My state doesn't have a state income tax and I'm not an accountant, so I really don't know.
However, that's my understanding. And, given that, as long as that is the case (and the current GOP Tax bill proposes to eliminate that), aren't we kind of being schmucks for not having a state income tax at some point? It's not like the taxpayers actually save money, it's deductible. So you pay the same amount, we just pay it to the Federal government.
Unless I'm missing something.
Which I may very sell be.
2 comments:
The way I understand it, when you are determining your Gross Adjusted Income your state income taxes are deductible which means that your Gross Adjusted Income would be lower if you paid state income taxes.
So, your federal taxes would only be lowered by the amount of state income taxes paid multiplied by your top tax rate.
Of course, I'm not an accountant either, so I wouldn't bet the farm on my explanation.
That does make quite a difference, doesn't it?
I wonder if it would be asking too much to expect people who write on this stuff for news articles to actually report it accurately?
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