Look Out N.Y., L.A. and Chicago: The New Tax Law Makes Dallas Even Stronger

The rich will get richer, thanks to the new tax law, and Texas will become an even better destination.For many years, Texas has been attracting corporations and residents from high-tax states, in part because there’s no state income tax and the cost-of-living remains relatively affordable.The new tax law will make Texas even more attractive, especially compared with California and New York. Those states, along with Chicago, provide plenty of migrants to Dallas already.Most of the individual and family savings from tax reform are going to high earners. In Texas, three-quarters of the upside will be claimed by taxpayers earning over $106,000, according to the Institute on Taxation and Economic Policy, a "nonprofit, nonpartisan" research firm in Washington.To offset those gains — and the hit on the deficit — the law includes a $10,000 cap on deductions for state and local taxes. That feature can punish some residents in high-tax states but has a more muted effect here, even with property taxes rising fast.The cap on the so-called SALT deduction will affect just 3 percent of Texas taxpayers in 2019, about 386,000 individuals and families, ITEP estimated. That compares with 9 percent of filers nationwide. In New York and California, 16 percent of taxpayers will face the cap — and their hit will be much higher.  Continue reading...