SALT deduction

Middle-class households in New Jersey and other high-tax states would benefit from an expansion of the deduction, a key House Democrat said.

There were last-minute changes on modifying the SALT deduction and a provision allowing Medicare to negotiate drug prices.

Congressional Democrats floated fresh proposals on how to increase the federal deduction on state and local taxes, but House and Senate lawmakers were at odds over whether the very rich should be allowed to take the tax break.

Democrats have found new urgency to pass the roughly $1.75 trillion tax and spending plan as well as an infrastructure bill with $550 billion in new spending after being stung by a Republican sweep of statewide races in Virginia.

The move would help offset the benefits from a proposed expansion of the federal deduction of state and local taxes.

An adverse court ruling leaves wealthy states with fewer options.

The outline of the tax and spending bill provided a breakthrough after a long standoff between moderate senators and progressive Democrats.

Influential lawmakers still want various tax provisions in the bill.

The spending package could still include a measure to expand or temporarily remove the cap on the deduction on state and local taxes.

What pros are making; getting clients to pay; keeping the SALT cap; and other highlights from our favorite tax bloggers.

Democrats risk settling for a less generous expansion of the state and local tax deduction than previously hoped after President Joe Biden conceded that lawmakers will have to scale back his economic agenda to get it enacted.

One suggested that a two-year repeal of the $10,000 cap will be the final solution.

The specific tax hikes remain to be detailed, as does any move to suspend or expand a $10,000 SALT cap.

Democrat legislators are attempting to move forward with the next step needed to pass President Biden’s economic agenda.

High-earning taxpayers would face much smaller tax hikes — or even cuts — if Democrats decide to restore the federal deduction for state and local taxes in legislation that’s now moving through the House.

House Democrats are considering a two-year repeal as one of their potential paths to undoing the $10,000 cap on the federal deduction for state and local taxes.

The stumbling block is scrapping the deduction limit without losing progressives wary of a tax cut that would overwhelmingly benefit the wealthy.

A CPA and a corporate communications vet are at the forefront of trying to reinstate the state and local tax deduction.

New York City mayoral candidate Eric Adams told a group of House lawmakers that the limit on the state and local tax deduction is harming the city.

Democrats may include at least a partial expansion of the state and local income tax deduction in the $3.5 trillion budget outline that Senate Democrats agreed upon this week.