Rocky Start for California SALT Cap Workaround Is Smoothing Out

Jan. 31, 2024, 9:45 AM UTC

What do a preschool, a recycling facility, a popular kombucha maker, and a famous hot sauce company have in common? They are all asking California tax authorities to relax penalties tied to the state’s elective pass-through entity tax.

The tax, established in 2021 to give owners of some types of business entities a way to get around the $10,000 cap on individual federal deductions for state and local taxes, remains popular as it heads into its fourth year. And it’s reached the next phase of tax administration: taxpayer disputes.

The first cases reaching the Office of Tax Appeals highlight ...

Learn more about Bloomberg Tax or Log In to keep reading:

See Breaking News in Context

From research to software to news, find what you need to stay ahead.

Already a subscriber?

Log in to keep reading or access research tools and resources.