Representative Tom Suozzi, DN.Y., speaks during the State and Local Taxation (SALT) news conference outside the U.S. Capitol on April 15, 2021.
Sarah Silbiger | Bloomberg | beautiful pictures
After fighting to repeal the $10,000 limit on federal deductions for state and local taxes, known as the SALT, a group of House Democrats said they would still vote for party spending package without SALT reform.
Representative Josh Gottheimer, DN.J.; Mikie Sherrill, DN.J.; and Tom Suozzi, DN.Y., members of SALT Caucus those who swore to oppose a bill without the SALT bailout, expressed support for the Inflation Reduction Act after it passed in the Senate.
Implemented through a 2017 Republican tax overhaul, the SALT cap has been a pain point for expensive states like New York and New Jersey because residents cannot deduct more than $10,000 in state taxes. and local on their federal profits.
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With a slim Democratic majority, SALT reform was a pivotal point in the Build Better Back negotiations, and the House passed Increase $80,000 SALT limit to 2030 in their spending package. However, the plan stalled in the Senate after the Senator’s objections. Joe ManchinDW.Va.
However, SALT advocates have changed since Senate Majority Leader Chuck Schumer, DN.Y. and Manchin announced an agreement at the end of July on the reconciliation bill including climate, health care and taxes.
“This law doesn’t raise taxes on families in my County – it reduces their financial burden,” Gottheimer said. said in a statement. “For that reason, and because of strong climate support, lower prescription drug prices and job creation, I will vote for it.”
But “if someone tried to change the tax rate for families in my county, I would insist that we reinstate the state and local tax withholding,” he added.
Sherrill and Suozzi share similar views, including plans to vote on the bill.
“Regarding SALT, the Inflation Reduction Act does not raise personal income taxes and ‘No Salt, No Deal’ does not apply,” Suozzi said in a tweet.
More recently, there have been other efforts to fight SALT relief. The three lawmakers, along with Representative Tom Malinowski, DN.J.; and Katie Porter, D-Calif.; in the May sent a letter to the leader of the House Allocation Subcommittee, requesting the denial of IRS funds to block state-level SALT limit alternatives.
And the push for reform of SALT faced setback in April when Supreme Court rejects a challenge to reverse the law.
While advocates say the SALT deduction limit hurts middle-class families, opponents argue that removing the limit could primarily benefit wealthy homeowners.
If repealed altogether, the top 20% of taxpayers could get more than 96% of the relief, according to the Tax Policy Center. reportaffects only 9% of American households.
Without an extension from Congress, the $10,000 SALT cap will cease to exist in 2026 along with other provisions from the Tax Cuts and Jobs Act of 2017.