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Louisiana Reacts to the Federal Cap on State and Local Tax Deductions

On June 22, 2019, Louisiana governor John Bel Edwards signed into legislation Senate Bill 223, which enables pass-through entities like partnerships and S corporations to elect to be taxed at the entity level. The purpose of this litigation is to mitigate the effects of the federal cap on state and local tax deductions instituted as part of the 2017 tax reform. Essentially, the law aims to give these pass-through entities, who often pay tax at the individual owner level, a way to deduct state taxes from federal income tax calculations, since there is no cap on deductions for state and local corporate taxes.

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It’s a Good Time to Buy Business Equipment and Other Depreciable Property

There’s good news about the Section 179 depreciation deduction for business property. The election has long provided a tax windfall to businesses, enabling them to claim immediate deductions for qualified assets, instead of taking depreciation deductions over time. And it was increased and expanded by the Tax Cuts and Jobs Act (TCJA).

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