Financial planner: Trump tax plan would hurt middle class Long Islanders
President Donald Trump's new tax reform plan may be beneficial to some residents with higher incomes, but middle class homeowners on Long Island could be hurt by the removal of state and local tax deductions.
The Republican proposal would consolidate the number of tax brackets from seven to three, decrease the highest tax bracket rate to 35 percent, cut the corporate tax rate to 20 percent and slash the small business tax rate by nearly 14 percent.
Michael Solomon, of Greenport, is pleased with President Trump and his tax reform plan. He falls in the highest tax bracket and is a business owner. Accountant and financial planner Robert Eckhardt says that makes the president's proposal a win-win for him.
"His top bracket is 39.6 percent currently, and the tax proposal right now, we're looking at 35 percent. That's good news for Michael," says Eckhardt.
However, the same is not true for Christine Bressingham, of Holtsville, who works as a consultant in Eckhardt's office. He says Bressingham and other middle class homeowners on Long Island could be hurt by an aspect of the plan that calls for the removal of state and local tax deductions. That would be a big deal in Nassau and Suffolk, where residents pay some of the highest taxes in the nation.
Gov. Andrew Cuomo called Trump's tax plan "ludicrous." He says it amounts to an illegal double tax for many state residents.
The governor's office released a statistical analysis that found that without being able to deduct state and local taxes, nearly 1 million Long Island taxpayers would see an increase of $4,500 dollars in federal taxes.