Letting the SALT cap slip further upwards would undercut the TCJA’s long-term legacy, worsening the fiscal outlook of the tax package and providing an unneeded benefit to higher earners.
4 min read
The fate of the $10,000 cap on state and local tax (SALT) deductions remains uncertain, with some policymakers pushing for an increase or repeal of the cap before its scheduled expiration in 2026.
6 min read
Any move to repeal the cap or enhance the deduction would disproportionately benefit higher earners, making the tax code more regressive.
5 min read
The threatened lawsuit may be more a political exercise than a legal one, as a judge is unlikely to rule that the SALT deduction cap violates either the Equal Protection Clause or the Tenth Amendment
14 min read
New York, New Jersey, and Connecticut are pursuing a questionable legal strategy to overturn the cap on a federal tax deduction that benefits the wealthy.
5 min read
California’s plan to circumvent the new state and local tax deduction cap is dubious, but now Illinois, Nebraska, Virginia, and Washington are considering similar plans.
3 min read
The scramble to restore the full state and local tax deduction for high-income taxpayers has resulted in inventive proposals that, for both legal and practical reasons, are unlikely to succeed.
22 min read
As the Tax Cuts and Jobs Act seeks to simplify the tax code, a last-minute provision closed a potential new tax-planning strategy germinating before the bill even passed.
2 min read
If the state and local tax deduction is necessary to prevent double taxation, why don’t states offer a deduction for federal and local taxes?
2 min read
The National Conference of State Legislatures may revisit a decision to reject tax reform that repeals the state and local tax deduction.
2 min read
New Jersey has the worst state business tax climate of the 50 states and the third highest state and local tax burden. If federal tax reform prompts New Jersey to overhaul its tax code, it’s long overdue.
3 min read
The way the state and local tax deduction, alternative minimum tax, and Pease limitation interact is complex. This primer makes things easier to understand.
5 min read
This comprehensive overview of the of the House Tax Cuts and Jobs Act includes a summary of its details and macroeconomic analysis of how it would impact federal revenue, wages, GDP, and after-tax incomes.
20 min read
To achieve meaningful tax reform, Congress will require significant base-broadeners. Saving the property tax deduction makes the math more difficult, but still leaves clear paths forward.
6 min read
The state and local tax deduction isn’t just a costly federal subsidy. It also skews state and local tax policy decisions.
2 min read
A cap on the state and local deduction would limit tax increases for high-income taxpayers but also raise about one-quarter the revenue as full repeal.
2 min read
The state and local tax deduction favors high-income individuals in high-tax states. Six states—California, New York, New Jersey, Illinois, Texas, and Pennsylvania—claim more than half of the value of the deduction.
2 min read