Posted on 10/26/2017 8:26:53 PM PDT by House Atreides
I’ve noticed that a number of FReepers are having conniptions over the possibility that legislation reducing federal income tax rates will also ELIMINATE ITEMIZED DEDUCTION OF STATE & LOCAL INCOME TAXES (SALT).
I have a proposal for the new legislation. Have it give tax payers the CHOICE of 1) still deducting SALT but STILL ALSO using the current (i.e., unreduced) tax rate tables or 2) not deducting SALT but having their taxes computed using the new reduced rates.
Having worked in systems development for a number of years, automating that feature could be relatively simple for Intuit (maker of Turbo Tax software) developers and their competitors to accomplish. They do something similar at the point where all itemized deductions have been entered and the software program tells them whether the standard or itemized deductions would be best for them.
If this proposal were included you could truly say (paraphrasing a certain former President) “if you like your current federal income tax rates and your SALT deduction, you can keep your current tax rates along with your SALT deduction”. Of course, some of those throwing conniptions about the potential elimination of SALT deductions would likely demand they keep SALT deductibility and also get the new lower tax rates.
New York citizens can deduct their state income taxes from their gross income for federal purposes. I live in Texas and we have not a State Income Tax. As a result I am subsidizing New York State citizens relative to federal income tax.
Property taxes in Texas are higher than in New York. In this case New York is subsidizing me as it is a deduction from my gross federal income.
Both of these deduction should be eliminated and federal tax rate adjusted so as to be tax neutral for all states.
If such were done Texas can not bitch about New York nor can they bitch about Texas.
PS
Upstate New Yorkers are welcome in Texas, they are actually mostly conservative. New York City not so much, but I must admit that our great president is born, breed and a product of New York City. Sometimes they get it right.
With a single low flat tax, that takes care of itself. People would have money left over to decide if they want to have more kids.
We want people to deduct their mortgage interest
No, we want people to pay the market value of their home.
True.
but you're STILL paying tax twice, because that money that you have to give for sales and property tax is still considered in your AGI....
and what about mortgage interest?...govt sure makes you pay for any "interest" you get on your savings....but they won't allow a deduction for the interest you pay?...
and another thing, many people are good charity givers, and many charity givers also have the thought in the back of their minds that its "tax deductible"....
I predict if people can't itemize and deduct their charity giving, charity giving will go way down...
And this proposal/Bill DOES lower taxes on companies...who are VERY WEALTHY!
No it is not and it is, in fact, a damned LIE!
HORSESHIT!
Not only that, but it isn't even true.
Do I have to bring up the "HOUSING BUBBLE" and the CRASH it brought about ?
IN WHAT UNIVERSE?
And what about the property taxes in the other states, tat are high?
I'm subsidizing those with mortgages and dependent children;which is hardly "fair" to me and others in similar circumstances.
When we moved here, there was NO state income tax. Sadly...that changed and there's no going back.
Everyone should have skin in the game/have to pay something in income tax to the Fed Gov.! And NO giving tax money to people who don't pay taxes at all!
I was and am even MORE Conservative than President Trump!
“Why should state and local governments get to have their taxes deducted? Progressives want everybody to pay their fair share, right?”
it isn’t the state and local governments that will get their taxes deducted. its the TAXPAYERS getting to deduct from their federal tax bill what THEY PAID to the local and state governments
Between the doubling of the standard deduction to a new minimum of $24,000 for a married couple and the resetting of the tax brackets, still to be determined, plenty more people will be paying less in federal income taxes - those who might end up paying more specifically because they can’t cover the full deduction of their SALT live mainly in high-taxing blue states like California, New York, New Jersey and Illinois - the method in the Republicans’ madness is that if some of the people in these states lose the ability to deduct all their high state taxes they might start paying more attention to what goes on in their states and pushing for their politicians to start cutting expenses....
>>>its double taxation...a tax on a tax<<<
So, does that mean I can deduct my Federal Income Taxes from my State Income Taxes?
>>>I was and am even MORE Conservative than President Trump!<<<
President Trump is not a Conservative, yet he is pushing more Conservative Policies than the last two Republican Presidents. Of course they were both from the GOPe Bush Clan.
BTW - I was born in New York too. My Parents were Republicans unlike most everyone we knew living there.
Trump and the GOP will be blamed, should this abomination get passed by both Houses and become the law!
Will this get through both Houses, as is?
I don't know. I doubt that the GOP will have enough votes to get this part through, unless they give away a whole lot of garbage, which neither you nor I will be happy about about and even then...
It's not just the states you glibly rolled out, but also, Ct., Maryland, and quite a few others as well.
As it stands, this is NOT what Trump promised, on the campaign trail; not by a long shot!
Yes, trump never claimed that he was a Conservative; yet his every speech was VERY Conservative!
He appears to be far more Conservative than the Bush clan members, but them, what would one expect from a family who embraces Slick Willie and the shebitch ?
For many of us, state, local and real estate taxes were lost years ago to AMT. AMT is a very Orwellian tax. The government calls it an Alternative Minimum Tax. In reality, it is an Alternative Maximum Taking.
Are you willing, for YOUR taxes, to keep paying taxes computed using today’s tax rates/tables if you are allowed to continue deducting your state & local income taxes? In other words, keep your SALT deduction at the cost of not being able to use the new lower rates?
I know. I gave up many years ago trying to manually do the AMT calculations and have since depended totally on Turbo Tax to do them. It’s almost cruel when you see your nice “so far” computed tax refund amount at the end of “regular” processing suddenly plummet once the AMT calculation is done and you have to pay that higher amount instead of the “regular” amount.
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