President Donald Trump has indicated he might be willing to revise the a provision in his 2017 tax-cut law that caps the SALT deduction
(state and local tax deduction) at $10,000, The Hill reported today.
“In an interview with Washington-based reporters for regional news outlets, Trump said he’s ‘open to talking about’ the cap on the deduction, which has been opposed by lawmakers in high-tax states such as New York, New Jersey and California,” the magazine writes.
The 2017 law lowered income tax rates but removed a number of tax deductions in an effort to simplify the tax code. The SALT deduction was capped because many in Congress believe it subsidizes higher state taxes. But lawmakers in high-tax states like New Jersey have argued that the cap hurts middle-class residents.
NJBIA has opposed the cap on the SALT deduction. New Jersey has also passed legislation to allow local districts to convert property taxes into charitable contributions to help taxpayers get around the cap. Charitable contributions are still deductible.
The magazine notes, however, that changes to the SALT cap are unlikely to be supported by the Republican-controlled Senate.