Warning shots are sent as a way to persuade a potential enemy to withdraw from its position and cease further threatening actions. Since the passage of the Federal Tax Cuts and Jobs Act (TCJA) it is getting difficult to follow who fired last. The virtual elimination of the itemized deduction for state and local income and property taxes clearly has created the biggest display of fireworks between the federal government and high tax states.
How appropriate that on July 3, while most of us were leaving early for the Independence Day holiday, New York State released guidance on the implementation of the Employer Compensation Expense Tax (ECET). The ECET was created as a workaround to the limited SALT deduction by allowing employers to elect to pay a payroll tax expense for employees.