{ "media_type": "text", "post_content": "For real, why would anyone want to increase the SALT cap? Do y'all just like giving tax breaks to the wealthy and no break to the middle and lower class?", "post_id": "61981fdfe13e7400275d4ad4", "reply_count": 124, "vote_count": 22, "bowl_id": "599555b669a73a0010aab3ac", "bowl_name": "Tax Bowl" }

For real, why would anyone want to increase the SALT cap? Do y'all just like giving tax breaks to the wealthy and no break to the middle and lower class?

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Any itemized deduction is there for a reason. Mortgage interest is to encourage home investment. Two people own the same home in same neighborhood and one pays less income Tax because they have mortgage interest. Some agree - some would not. So tax deductions/credits are typically for fairness or incentivize a behavior. Personally - with federal rates. As high as they are - I think it is fair for federal government to not tax income that was used to pay for state and local taxes . We already have a very progressive federal tax system where the more you make the more they take . All the SALT deduction does is say that is you pay state taxes - we won't tax the income used to pay those taxes

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Most people who are substantially over the $10k cap are pretty darn well off, often times at the upper echelons of middle class or higher. Maybe you consider pushing the cap marginally higher, or tying to inflation, but not much. If federal is separate from state, tax the income in each proportionality. If the income taxes or property taxes are too high in your jurisdiction and you feel you aren't already seeing the benefits of the higher taxes, vote with your voice, ballot, or feet, and change your situation. Don't look to the feds to bail you out of the higher taxes.

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PWC 3 - Property is not being taxed twice. Federal government does not assess tax on the current fmv of a property. States such as Washington, Florida don't have state income tax so no double taxation there on income tax. I wouldn't say it's rare to have double taxation. If we want to fund a federal government and state/local governments then taxes will have to be paid to both.... Also to your assessment of who wants this- *coalition of wealthy Democrats and wealthy Republicans.

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I’m in CA and my property taxes alone are almost $10k… state tax is about $16k. It’s really easy to hit $10k

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But you get a 25k deduction. Sure you are missing out on some, but you are getting a standard deduction

I just think it’s good policy generally to allow a state tax deduction to avoid being taxed on the same income multiple times…especially when you have to file in multiple states.

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1. Covid pandemic 2. 0.5% lol Do you know how many people live in NY? 100,000 isn’t that much. Also, confusing signal with noise. And also completely ignoring the issue of correlation vs. causation. 3. Now do California pre-pandemic.

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$10K isn’t difficult to hit for moderate income folks in many states. In Illinois—even in some rural areas, a MFJ couple with a $200K house and $100K combined income are likely at the cap. Not exactly living the high life at that level but still impacted.

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You’re nuts. You’re using the median value home? This is silly. NJ has some of the most expensive real estate in the country outside of NYC, but you’re mixing in areas of, frankly, poverty. I don’t live there, but would expect Northern NJ suburbs are mostly at or approaching $1m for a single family home in a town with schools and a commute that your average B4 person, doctor, lawyer, whatever wants to live in.

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Pelosi considers herself middle class so there’s your answer.

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Raising it to 80k seems ridiculous. I could see them raise it to something like 25k or something. Who knows?

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Umm plenty of us pay very high property taxes on small/average homes. I’m in IL and property taxes on a 2,000 sqft home in my area hover around $14,000.

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It’s a fun curveball politically honestly. Yes it does benefit those communities more, but ironically they tend to be the solidly liberal blue states instead of the red states. Republicans who claim to be against taxes are in a bind in opposing this and blue state Dems can say they are bringing the revenue back home instead of subsidizing voters in Texas who elected Ted Cruz (or whatever).

Tell me you live in a lcol area or don’t own a home without telling me?

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Reminder that it's state taxes + property tax, I don't consider myself rich but am around $28k in state tax + property tax for spouse and I. The $10k limit impacts a lot of people not just the 1%.

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$10k is easy to hit in many areas for people who are not wealthy. A lot of places have high property taxes on very regular sized homes. I live in a 3 bedroom, 2.5 bath house with 2300 sq feet in Seattle (hardly a mansion) and pay over $10k in property taxes. My lot is a postage stamp. 🤷🏼‍♀️

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We tithe (to charitables, not to church) plus have mortgage interest and the property taxes so always have significant deductions. I think last year our itemized deductions were about $40K.

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I’ve always found this interesting because so many of the people who are against raising or eliminating the SALT cap say it’s because it benefits the rich. Typically that is a liberal viewpoint, which is more common in states that have higher tax rates. And of course it was New Jersey, New York, Maryland, and Connecticut that sued over it.

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I think anyone who is not wealthy would support this viewpoint regardless of liberal or conservative. True there are those in the states you mentioned so may be slightly impacted by the salt cap more than liberal individuals in other states, etc. But 2k that is limited vs 78k of a wealthy individual is huge, etc. Then on the conservative side I suppose there are those temporarily embarrassed millionaires. There's definitely conservatives in new York and other high tax states as well.

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To buy votes because the Dems are going to lose their majorities?

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I see no value for the US government to subordinate their taxing ability to the whims of the individual states. Keep the $10K cap, it is more than generous.

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You can’t define someone nationally as upper middle class. Alabama is a poor state that their government has caused by bad policies so why should I subsidize their bad policies?

NJ property taxes alone far in excess of10k. Even on modest homes. Getting crushed on taxes. Affects many hard working families.

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The AR taxpayer is receiving an inherent benefit because AR is able to lower their state and property taxes by the amount they are receiving from the federal government . This system is broken and needs to be fixed.

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Last time I checked, lower and middle class received multiple rounds of stimulus money, are getting a monthly payment per child, pay lower income taxes, can get a credit back for health insurance through Obamacare…@OP please explain how there’s “no break” between middle and lower class??? Which by the way I agree with all breaks mentioned above + increases for livable wages. But most high earners aren’t Jeff Bezos. They’re people paying in at 37% federal + state income tax + fica + real estate + sales tax. Is it so bad to not want to give over 50% of your money away to the government?

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I’d have no problem paying more taxes if our federal government wasn’t such a colossal cluster. It’s like giving a drug addict free cash. I don’t have a better answer but more money to the feds just means more waste and mismanagement.

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Legislature should change the tax laws so that everyone can deduct whatever they want from a list of qualified expenses, but to a certain limit, like the higher of $40,000 for an individual or $80,000 for a married couple or 20% of AGI. This could include state income taxes, sales/use taxes, studentoan interest, charitable contributions, certain interest expenses, out of pocket medical expenses, child care expenses, etc.

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It’s good for fees when my clients are all scrambling to estimate their taxes and prepay their state taxes by 12/31. I don’t miss the 12/26 to 12/31 mele but that was a lot of fee revenue taken off the table.

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Another conflation of income and wealth.. flush twice.

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Let's talk about the estate tax then and how the exemption amount doubled.

In HCOL states $10k cap doesn’t support anyone. Middle class will benefit from a $20-40k salt cap. 10k truly doesn’t do anything. This is way states are rolling out pass through entity elections for 1065 and SCorp owner to offset liabilities.

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$40,000 is a middle class salary? You’re telling me “middle class” families are paying $40,000 in state and local taxes 🤔 Well, tough luck I guess to those MC families making >$100,000 … you don’t me subsidizing your state provided services! 😉

10k was low, but 80k is way too high though. That’s like the median household income. Imagine someone paying in state/property taxes what an average family makes in a year.

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