Illinois Senators Dick Durbin and Tammy Duckworth, as well as Illinois Rep. Brad Schneider, are leading the charge to repeal the cap on state and local tax deductions, as reported by Crain’s and elswehere. They’ve each sponsored bills to eliminate the SALT cap, as it is called, which became law in 2017.
That cap of $10,000 on deductibility of state and local taxes, including property taxes, walloped many high income taxpayers not just by increasing their federal tax bill but by reducing the value of homes they own. We described the research showing that in our recent article here.
There’s actually no debate about it: Liberal and conservative tax experts alike agree that the eliminating the SALT cap would be a windfall for high earners. The conservative Tax Foundation explained why here, and the liberal Institute on Taxation and Economic Policy, ITEP, wrote this in an article opposing elimination of the cap:
Author(s): Mark Glennon
Publication Date: 2 February 2021
Publication Site: Wirepoints