NORWALK, Conn. – There are 3,866 Norwalk residential taxpayers who are potentially affected by the recent change to federal tax law to limit SALT deductions to $10,000, Finance Director Bob Barron said.
That’s from a total 21,241 taxpayers and based on the 2016 Grand List used for Fiscal Year 2017-18, making it 18.2 percent of Norwalk taxpayers.
The GOP-led Congress in December passed a tax reform bill that puts a $10,000 limit on the deduction for state and local taxes (SALT). Mayor Harry Rilling and the Common Council expressed concern for Norwalk citizens as they set an appropriations cap recently, saying that Norwalk’s taxpayers are already under duress.
Tax Collector Lisa Biagiarelli, responding to an inquiry from NancyOnNorwalk, said she couldn’t estimate what percentage of taxpayers are affected by the feds’ SALT deduction move.
“You can look at tax bills but you don’t know who itemizes, you don’t know how many properties any one individual taxpayer may own; you have taxes in names other than personal names … no way of telling,” she wrote in an email.
She couldn’t go through the computer and come up with an estimate because, “My data does not distinguish between ‘types’ of real estate – for example, office building, single family residence, strip mall, garage, boat slip, vacant land etc. All I have is an assessment and values for land and buildings if any.”
Tax Assessor Michael Stewart said an assessed value of $555,000 would generate a tax bill of about $10,000, but, “other questions are best directed to the Tax Collector.”
Barron asked Norwalk’s IT programmer to extract the information from the database “as there are no canned reports that generate this easily.”
The 3,866 residential taxpayers who pay more than $10,000 a year in property taxes generate $65.8 million in tax revenue, and average $17,015 per taxpayer, he said.
Barron said he’s not a tax advisor and does not know the net impact of the changes but, “For example, a person that pays $10K in state income taxes and $10K in property taxes in 2017 would be able to deduct $20K from their taxable income and in the current 2018’s tax code will be limited to $10K; however, it’s hard to say if the new tax code will generate more or less taxes due to the standard deductions that have increased substantially. The tax impact will vary greatly depending on your income level, prior versus current available deductions, marital status and number of children.”