Section 1 Modification of limitation on deduction for State and local taxes, etc
by striking “2025” in the heading and inserting “2031”,
by striking “January 1, 2026” and inserting “January 1, 2032”,
in subparagraph (A), by inserting “or section 216(a)(1)” after “subsection (a)(1)”,
in subparagraph (B)—
by inserting “(and any tax described in any such paragraph taken into account under section 216(a)(1))” after “paragraph (5) of this subsection”, and
by striking “shall not exceed $10,000 ($5,000 in the case of a married individual filing a separate return).” and inserting
“(i) in the case of any taxable year beginning after December 31, 2020, and before January 1, 2031, $80,000 ($40,000 in the case of an estate, trust, or married individual filing a separate return), and
“(ii) in the case of any taxable year beginning after December 31, 2030, and before January 1, 2032, $10,000 ($5,000 in the case of an estate, trust, or married individual filing a separate return).”
by striking the last sentence and inserting the following: “In the case of taxes paid during a taxable year beginning before January 1, 2031, the Secretary shall prescribe regulations or other guidance which treat all or a portion of such taxes as paid in a taxable year or years other than the taxable year in which actually paid as necessary or appropriate to prevent the avoidance of the limitations of this paragraph.”.
Effective date— The amendments made by this section shall apply to taxable years beginning after December 31, 2020.
No inference— The amendments made by paragraphs (3), (4)(A), and (5) shall not be construed to create any inference with respect to the proper application of section 164(b)(6) or section 216(a) with respect to any taxable year beginning before January 1, 2021.