NYS Decoupling from TCJA changes

[Uncle Sam]

Here's the link to get updated information on NYS's decoupling of Federal changes of itemized deductions:

https://www.tax.ny.gov/pdf/memos/income/m18-6i.pdf

[Dude]

I am missing something how can NYe collect money if you are able to deduct what you paid to the state from you state taxes? the above announcement indicates that NY residents can still itemize more than $10,000 of State and Local taxes. LIne 5 of the IT -196 (NY state itemization form) has an entry for state and local taxes. Then line 41 requires you to subtract the state and local taxes from your total as these are not deductible.

https://www.tax.ny.gov/pdf/current_forms/it/it196_fill_in.pdf

[Uncle Sam]

I guess the real estate taxes would still be deductible from NYS whereas the state income taxes aren't.

[Burke]

Correct. Note Line 41 states you deduct state, local and foreign INCOME taxes shown on the form. Real estate, personal property, etc are allowed. This is how it was always done if you itemized. They are allowing all the old itemized deductions, whether you claim standard on the federal or not. I wish some other states would do it too.

[Dude]

Yeah,but why add the income taxes in on line 5 only to deduct them on 41? It's not like there is an income requirement that has to be meted out, Income taxes are not allowed to be deducted (logically so). Promotional materials and the form directions go out of their way to include income tax verbage that leads one to believe they are deductible when they never were in the first place.

[New York Enrolled Agent]

I am missing something how can NYe collect money if you are able to deduct what you paid to the state from you state taxes? the above announcement indicates that NY residents can still itemize more than $10,000 of State and Local taxes. LIne 5 of the IT -196 (NY state itemization form) has an entry for state and local taxes. Then line 41 requires you to subtract the state and local taxes from your total as these are not deductible.

https://www.tax.ny.gov/pdf/current_forms/it/it196_fill_in.pdf

It appears you are not differentiating real property tax with income tax.

Line 5 and line 41 refer to income tax

The announcement says: state and local real estate taxes paid

[Dude]

Thanks NYEA I noticed that right after I posted (even though I read the announcement 5 times argh). Still Cuomo made a point of saying "income tax" in his announcements and I still don't know why you would add the income tax on line 5 just to subtract it again on line 41.