New York State has decided to separate itself from certain personal income tax changes brought on by The Tax Cuts and Jobs Act (“TCJA”). This will allow you to treat the items listed below the same as you would have prior to the TCJA.
The following addresses the areas where New York has decouple from the TCJA:
Itemized Deductions
As a taxpayer you are allowed to itemize deductions for New York State income tax purposes for tax years 2018 and after, even if you did not itemize on your federal income tax return. Therefore, you are still able to deduct:
- The total of your state and local real estate taxes paid, including amounts that exceed the $10,000 federal limit,
- Casualty and theft losses are only deductible if they occur in a federally declared disaster area, but New York State will allow them regardless of where they occur,
- Unreimbursed employee business expenses and,
- Miscellaneous deductions that are no longer allowed for federal purposes (e.g., tax preparation fees, investment expenses, and safe deposit box fees) remain deductible by New York State.
Alimony or Separate Maintenance Payments
New York State has decided not to follow the TJCA treatment of alimony or separate maintenance payments made under an alimony or separation agreement that was executed or modified after December 31, 2018.
Qualified Moving Expenses Reimbursement and Moving Expenses
New York State will continue to allow taxpayers to exclude qualified moving expenses reimbursements, and moving expenses from their New York adjusted gross income (“NYAGI”). Therefore, you will be able to deduct both items on your New York State tax returns.
Empire State Child Tax Credit
Taxpayers are not permitted to use their current tax year’s federal child tax credit or additional tax credit. Instead, the credit will now be based on the 2017 federal credits and income.
529 College Savings Account
The withdrawals for kindergarten through grade 12 school tuition are not qualified withdrawals under the New York 529 college savings account program. Withdrawals that are dispersed in cash or in kind, from college savings accounts and are not being used for higher education of the designated beneficiary are considered nonqualified withdrawals.
If you have any questions or concerns regarding these changes please contact a team DKB member today!
