Big earners in high-tax states like New York, New Jersey, and Illinois hit hard by a new federal tax law are flocking to low-tax states like Florida, The Wall Street Journal reported.
Miami is one of the biggest winners from the shift.
"I've been starting to see New Yorkers as Florida's new foreign buyer," real estate appraiser Jonathan Miller, who publishes quarterly reports for real-estate company Douglas Elliman about the South Florida market, told the Journal.
"If they were already on the fence, I think the tax law has changed the calculus for some."
Florida had the highest level of net domestic migration from July 2017 to July 2018, according to Census data released in December, the Journal reported. New York was the largest overall population loser, followed by Illinois.
Before You File Your Taxes, You Must Read This
With the shift comes a rise in the median price for condos in Miami-Dade County, the Journal reported — increasing to $235,000 in the fourth quarter of 2018, a 2 percent rise from a year earlier, according to EWM Realty International.
Manhattan co-op and condo sales last year were down 12 percent from 2017 to their lowest level since 2009, an analysis found.
The law that went into effect at the start of last year cut federal income taxes for most Americans — but capped the deduction for state and local income and property taxes at $10,000. The bill also capped the size of a loan on which mortgage interest could be deducted at $750,000, which hurts states with higher home prices.
Since many residents in New York, New Jersey, and Connecticut had been deducting well over $10,000 a year, the new tax rules are costing them tens of thousands of dollars more than if they lived in states like Florida and Texas that have no state income tax, the Journal reported.
"A lot of rich people are trying to find a way out of New York," Barry Horowitz, an accountant who specializes in helping clients switch residency to lower-tax states, told the Journal.
Trump’s April 15 Deadline: Tax Loophole Saves Thousands
© 2021 Newsmax. All rights reserved.