State and local tax deduction

The United States federal state and local tax (SALT) deduction is an itemized deduction that allows taxpayers to deduct certain taxes paid to state and local governments from their adjusted gross income. The Tax Cuts and Jobs Act of 2017 put a $10,000 cap on the SALT deduction for the years 2018–2025.[1]

The SALT deduction reduces the cost of state and local taxes to taxpayers. It disproportionately benefits wealthy and high-earning taxpayers in areas with comparatively high state and local taxes.[2][3][4] The Tax Policy Center estimated in 2016 that fully eliminating the SALT deduction would increase federal revenue by nearly $1.3 trillion over 10 years.[5]

  1. ^ Cite error: The named reference :6 was invoked but never defined (see the help page).
  2. ^ Rappeport, Alan; McGeehan, Patrick (18 November 2021). "Tax Deduction That Benefits the Rich Divides Democrats Before Vote". The New York Times. Archived from the original on June 3, 2022.
  3. ^ Pulliam, Christopher; Reeves, Richard V. (September 4, 2020). "The SALT tax deduction is a handout to the rich. It should be eliminated not expanded". Brookings Institution. Archived from the original on November 10, 2021. Retrieved November 11, 2021.
  4. ^ Bellafiore, Robert (October 5, 2018). "Who Benefits from the State and Local Tax Deduction?". Tax Foundation. Archived from the original on October 8, 2021. Retrieved November 11, 2021.
  5. ^ Sammartino, Frank; Rueben, Kim (March 31, 2016). "Revisiting the State and Local Tax Deduction" (PDF). Tax Policy Center. Archived (PDF) from the original on November 6, 2021. Retrieved November 11, 2021.

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