For example, if a Connecticut partnership has two partners and $1 million in income in total, it would pay the state $69,000 under the new pass-through entity tax. That would leave $931,000 of taxable income to pass along to the two partners. The two partners could deduct 93 percent of that $69,000, or $32,085 each, from their federal tax bills -- an offset that could compensate for the SALT cap.

Still, some tax professionals aren’t sure the state’s plan, which took effect on Jan. 1, will work.

Depending on how much income your pass-through makes, the workaround “might not cover your SALT bill,” said John Ermer, an accountant and tax partner at Beers, Hamerman, Cohen & Burger in New Haven, Connecticut.

If the IRS were to issue regulations striking down these types of arrangements, or the arrangements were challenged in an audit, taxpayers could be in a position where they pay the state more than their tax bill was in the first place, said Michael D’Addio, a principal at accounting firm Marcum.

New York Payroll Tax
New York state also included a way to mitigate the SALT issue through employers in its legislation about the charitable workarounds. Since the tax law kept businesses’ SALT deductions unlimited, the New York law lets companies opt in and essentially pay for their employees’ state taxes.

The payroll tax would partially replace the personal income tax and be deductible for employers. To cover the state tax payments, companies may lower wages, which is seen as a major hurdle to the strategy becoming popular. But it’s possible more companies will consider the workaround after the IRS moved to curb the charitable contribution programs. They have until Dec. 1 to opt in for 2019.

The New York State Department of Taxation and Finance issued guidance in July with more details for employers. Critics said the guidance still didn’t answer the question about whether employers could be prohibited from adjusting wages to offset the cost of the tax.

The payroll workaround is administratively difficult and won’t benefit very many people, according to Jared Walczak, a senior policy analyst at the Tax Foundation. Companies will have to make sure their payments comply with collective bargaining agreements and state minimum wage laws.

The state’s department of taxation and finance didn’t respond to an inquiry about how many companies have signed up for the program.

Non-Grantor Trusts
There may be one other option for wealthy individuals, regardless of where they live, to try to avoid the $10,000 SALT limit. The move generally involves a series of transactions to put residences into a limited liability company in no-tax states, and then transferring those interests into separate trusts that can each take the $10,000 deduction.