How Will States Respond to Federal Tax Changes?

Stephen Kranz said that “there are easy fixes on the back end” for state and local taxes in some federal tax changes, but added that “border adjustability is really the sticking point in terms of what conformity does to the states … and how states might consider fixing it.” Diann Smith pointed out the dilemma for the states “in that the states rely so much on the federal calculations. The states are going to have to figure out how to adjust this so any state base is constitutional.”