Though the nation continued to struggle with the health effects of the pandemic, state budgets unexpectedly rebounded from the challenges faced in early 2020. The relatively good news for state finances was largely driven by a rebounding economy and a massive influx of federal aid. The improving fiscal situation has allowed a number of states to reduce corporate and personal income tax rates for 2021 and beyond.
Our state and local tax year-end guide explores the major state tax headlines of 2021 and looks toward 2022 and a variety of issues that should be considered, including:
- Federal legislation affecting state and local tax, including the Consolidated Appropriates Act and the American Rescue Plan Act of 2021
- State tax amnesties
- Recap of sales and use tax legislation including a look at Wayfair legislation and economic nexus in year four since the landmark court case
- Adoption of remote employment consequences on state taxation
- A look at pass-through entity taxes and the states that have adopted workarounds to the federal state and local tax deduction limitation
