By Jon Dougherty
(NationalSentinel) Thanks in large part to the Trump-GOP tax reform law passed in December 2017, residents of high-tax states like New York, New Jersey, and California are leaving in high numbers — and the exodus is only just beginning, say experts.
AsÂ Fox Business noted:
The cap on state and local tax (SALT) deductions has already begun toÂ driveÂ some residents away fromÂ high-taxÂ states like New York and New Jersey, but experts say that trend is only going to intensify.
â€œIt took a few months for taxpayers to realize the dollar implications â€“ until they actually filed their tax returns this year,â€ Alan Goldenberg, a principal at Friedman LLP, told Fox Business. â€œIt quantified the impact of the loss of the SALT deduction when people saw it in front of their eyes on their tax return.â€
The reform law, called the Tax Cuts and Jobs Act, implemented several new measures including a $10,000 cap on state and local tax deductions. That has led many Americans to begin looking to establish legal primary residences in states where such liabilities can be limited.
Since the law came into effect, Goldenberg said he has “certainly” had some clients move to lower-tax states. Often, such clients have second homes in low-tax states like Florida, as well as wealthy earners who have jobs that don’t require them to remain in one physical location.
Besides Florida, states like Texas and Nevada, which have no state income taxes, have become top destinations.
Goldenberg said he believes he’ll see â€œmore and moreâ€ taxpayers consider moves in the wake of this yearâ€™s tax season, which is ongoing for those filers who requested a six-month extension.
Fox Business noted further:
Some businesses, too, are looking to move. Those that have other locations in places like Dallas and Houston can more easily relocate, Goldenberg said, but it is difficult for a large company with hundreds of employees to shift its main operations elsewhere.
Some higher-tax states, like New York, have looked into work arounds in order to limit the impact and stem the potential revenue loss. However, the Treasury Department officiallyÂ squashedÂ one of the more popular options last week, which could also contribute to outmigration.
More people moved to Florida than any other state. New Yorkers who left that high-tax enclave relocated primarily to the Sunshine State, with 452,580 people moving out within the past year — the third-largest outflow of residents.
California led the exodus, however, with the highest proportion of people headed to Texas, Arizona, and Washington.
Follow Jon Dougherty on Twitter at @JonDougherty10
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