Tax reform- state issues

[kathyc2]

If tax reform as outlined goes through I wonder how many state tax issues will occur?

For example: MD state return allows the federal Sch A deduction other than state/local tax deduction as a reduction against MD income. If they take standard deduction on federal the max reduction on MD return is 4K. Moving the standard deduction to 24K will result in a lot less people itemizing. So, unless MD also makes some changes, many people will end up paying more state tax as a result of the federal "reform".

I'm guessing other states and issues that will pop up if this is passed.

[David1980]

I don't think the politicians pushing this care about the increase in state taxes. That is, most in support are in lower tax states and resent things like SALT because it benefits higher state tax states. So if a state tax goes up as a result I don't think they'd care much - at least not in the Senate.

If they do actually manage to pass anything I'd expect some states will compensate for sure. MD for example could simply allow itemizing at the state level even if the fed was standard deduction.

[kathyc2]

I just pointing that it will have ripple effects with states. Most states start w/ the federal return and them make adjustments off of it for state return.

Tax simplification my _____.