Tax Cuts & Cost of Living
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The Working Families Tax Cuts Act, signed into law on July 4, 2025, delivered major tax relief for families across the Hudson Valley - with the average family saving $4,000 this year and some even more! From expanding the State and Local Tax (SALT) deduction up to $40,000 annually, to eliminating federal taxes on tips and overtime, boosting the child tax credit, and creating or increasing deductions for seniors and small businesses, the law helps ensure working families keep more of their hard-earned money. For many households across Westchester, Rockland, Putnam, and Dutchess counties, the results are immediate. Bloomberg News and the Wall Street Journal both said New Yorkers are some of the biggest winners in the country. SIGN UP FOR MY E-NEWSLETTER FOR UPDATES
The law quadruples the SALT deduction cap to $40,000, up from $10,000. Now, over 90% of NY-17 residents can fully deduct their full state and local taxes. The law also added an income cap of $500,000 to ensure the biggest benefits go to working-class people, not the super-rich. The bill also keeps the Pass-Through Entity Tax (PTET) intact, ensuring significant tax relief for small-business owners across the Hudson Valley. No Tax on Tips and No Tax on Overtime The law delivers direct tax relief for service workers and hourly employees like restaurant workers, bartenders, police officers, and firefighters. New York has a massive workforce in restaurants, hospitality, health care, transportation, and public safety that relies on tips or overtime pay.
These benefits target low- and middle-income earners and function as an immediate pay raise for millions of workers. Seniors across the Hudson Valley are living on fixed incomes while facing rising costs for housing, groceries, and health care. By offsetting Social Security taxes, this tax deduction directly addresses affordability concerns and helps older Americans keep more of their earned benefits. Seniors can now claim an additional $6,000 deduction on their federal taxes
Making Middle-Class Tax Cuts Permanent Absent this new law, New Yorkers would have faced a significant tax increase. Instead, we were able to achieve:
Enhancing Deductions for Small Business Investment Businesses can now immediately deduct the full cost of certain equipment purchases. They can also immediately deduct domestic research and development (R&D) expenses, rather than spreading these deductions over future years. New York has one of the highest costs of doing business in the country. Allowing companies to fully deduct new equipment immediately helps offset those costs and provides small businesses with a greater opportunity to reinvest in their own operations. Permanent Opportunity Zones The law permanently reauthorizes the Opportunity Zones program, which provides better conditions for investment in underserved communities to spur economic development. New York has dozens of designated Opportunity Zones in communities that need long-term investment. Permanent status encourages more housing construction, redevelopment projects, and small-business investment in areas that have historically struggled to attract capital. In the Hudson Valley, this will directly affect Cortlandt, Haverstraw, Peekskill, and Valhalla. Lower Child-Care Costs for Working Families The law expands the employer-provided child-care credit and creates a separate credit for small businesses. Child care in New York can cost $18,000-$26,000 per year, creating major financial strain for families. More employers will be able to help workers cover child-care costs, and the credit is now indexed to inflation, so the support keeps pace with real-world expenses. |