Consumer Alert: What New Yorkers need to know about tax changes in 2025

ROCHESTER, N.Y. — A significant tax change could be on the horizon, and it’s causing concern among taxpayers and accountants alike. News10NBC’s Deanna Dewberry spoke with a prominent local CPA, who emphasized the importance of congressional decisions this year regarding the Tax Cuts and Jobs Act.

The Tax Cuts and Jobs Act, implemented on January 1, 2018, is set to expire at the end of this year. Congress faces the choice to let it expire, extend it, or modify it. This decision holds substantial implications for anyone paying taxes, especially those preparing them.

The act, often described as a sweeping tax overhaul, lowered tax rates, doubled the standard deduction and child tax credit, and increased exemptions on estate taxes. However, it also capped the federal deduction for state and local taxes (SALT) at $10,000, impacting many New Yorkers and residents of other high-tax states.

“That was a big change for many middle-class and upper-class tax filers in 2017 and 2018,” said Jim Schnell, a tax partner with MMB + Co LLP. “That’s where your property taxes and your New York state income taxes were capped at an annual limit of $10,000 per year. For many people, that was a substantial change.”

To offset the SALT deduction cap, the standard deduction was doubled. Despite this, there has been ongoing opposition to the cap, with President Trump pledging to remove it.

Ultimately, the decision rests with Congress. According to non-partisan groups like the Tax Policy Center and the Tax Foundation, eliminating the cap would primarily benefit the highest income earners, though other potential changes, such as adjustments to the standard deduction, could also play a role.

Until Congress makes a decision, 2025 remains a year of tax uncertainty, leaving many accountants on edge.

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