In an off year election cycle, voters in St. John’s County Florida have elected to add a local sales tax rate of a half cent effective January 1, 2016. The new sales tax rate will be 6.5%, rounded up to the nearest penny. The money is intended for local schools as the St. John’s County school district continues to expand rapidly.
If you have operations or sales in St. John’s County, be sure to update your Quickbooks or other accounting software for the change in the rate by year end. All other limitations on local sales tax rates apply, including the limit on large purchases over $5,000.
Despite bi-partisan support in the House and Senate to extend the optional deduction for state and local sales taxes as an itemized deduction for Federal tax purposes, the extension for this deduction has not been signed into law as of October, 2015. Both the House and the Senate have passed measures that would extend the state and local sales tax deduction through 2016. This deduction is especially valuable for states like Florida that do not have a state income tax. Disagreements between the Congress and Administration still exist as to how long certain expired tax breaks should be extended and whether some deductions should be dropped from the normal mix that gets extended every year.
Other expired deductions that are on the shelf include but are not limited to higher Section 179 depreciation levels, bonus depreciation, the deduction for educator expenses, and the ability to make donations directly from an IRA to charity.