How The GOP's New Tax Reform Bill Impacts Greater Philadelphia

The GOP's new tax reform bill just passed - and it will drastically reduce the amount of state and local taxes (SALT) that can be deducted from federal income taxes. The natural question many Americans are asking is "how will this new tax bill impact me financially?"

Houwzer's Senior Economic Advisor, Dr. Kevin Gillen, examined the tax return data from the IRS to determine the average SALT deductions claimed in each zip code in the Greater Philadelphia region.

The average SALT deduction range is vast - between $0 and $67,200. As you would expect, the largest SALT deductions reside in the most affluent areas. The majority of the zip codes that claim the highest deductions are scattered along the Main Line, South Jersey, and Northern Delaware.

Dr. Gillen's most notable takeaways:

1. While New Jersey's property taxes are some of the highest in the nation, they don't dominate the top of the list for SALT deductions in the region.

2. Wilmington, DE is among the highest - even though they have no sales tax.

3. Despite high city wage taxes, only one Philadelphia neighborhood (Rittenhouse Square) made it into the top 10 list for highest deductions.

You can read Dr. Gillen's full data analysis of the SALT deduction's regional impact here.