Federal is 37%. But if you add State and Local and live in NYC + 10% … (and latter is no longer fully deductible)
Some of us do stuff during the day to pass the time
Yep - I’m in California and paying a huge chunk of tax to California on top of federal taxes - and those taxes are no longer deductible 
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If he’s mowing lawns, then he can deduct a truck to carry his equipment in. But he’s not, so he shouldn’t make up a fake company for tax benefits. He’s an employee doing outside sales.
you are not allowed to deduct expenses to and from home/work (i.e. main locatoin0. I’m pretty sure you are allowed to deduct expenses for driving to other places.
yes, but if you’re maxing out those brackets (heck, I earn 6 figures, and my state + federal effective tax rate is only in the low 20s) I feel little pity for your taxes going up a bit.
I live right outside of NYC in NJ, I used to work in NYC and get the whole triple taxation BS where I pay federal, NJ state and NYC taxes. I don’t feel sorry for people that are making half a mil or more that complain that their taxes are going up a few hundred bucks or a few grand. It’s literally not a big deal. Now, middle class people that make too much to get free healthcare, but not enough that they can’t afford to pay for healthcare, now that sucks. Especially when you live in a high COL area.
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I get that too. I used to work and live in NYC. my income taxes actually went down when I moved to California. I also get wanting to minimize the amount of taxes one has to pay (in a legal manner) and don’t begrudge it. With that said, if the new tax plan makes leases more expensive, that just changes the calculation of the value of the lease. I’d also argue that if one is very impacted by the changes for leases (due to the size of their income and the high value of the lease), they will probably be more impacted in the future by the reduction in SALT and mortgage interest deductions. the lease change is a tiny tiny drop in the bucket.
Can you please explain to me why you pay NYC taxes if you are an NJ resident? I’m not just saying this as any old person asking.
I’m asking this as someone who both lives in NY and is a state and local tax attorney, meaning you should NOT be paying NYC taxes unless you are an NYC resident…
Also, no matter where you work in NY state, as an NJ resident, you get a tax credit for whatever you pay to NY and don’t actually pay tax to NJ, because the tax rate for NY is higher than NJ.
Similarly, I pay both NY and NJ state taxes, and I take a credit paid to NJ on my NY return, and I have the difference deducted on my checks, so I don’t pay very much to NY at all (I do not live in the city, so I do not pay city tax). I do work in NJ, which is why I pay NJ tax.
Ummm what do you consider high COL area? Average home price in our area is 7 figures, half a million income is really only $250K after taxes. So what if you make 500K, mortgage here is also like 35% of the income anyway.
UAs an unreimbursed cost, he was indeed allowed to deduct cost of transportation for sales to places other than his regualr office eg field sales. Now that the lease benefit is over, as someone rightly pointed out, he can still deduct mileage expense.
This can still be advantageous but not as easy as just deducting lease since he has to keep records of all trips and miles driven.
As for llc formation, many doctors etc are indeed setting up all sort of llcs. For example an llc that owns the building and equipment and to whom they pay rent.
You can setup an llc and lease the car under the name of the llc. There is nothing illegal. You can then pay the llc for cost of leasing the car back to you. The llc can now deduct all expenses associated with this car. You can deduct all expenses associated with leasing car from llc. Similar can be done with boats planes buildings mansions etc etc and that’s how the rich manage their assets
Owning the asset in llc also provides additional protection from creditors and lawsuits
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