SALT Deductibility Act Securing Access to Lower Taxes by ensuring Deductibility Act
Impact
The repeal of this limitation is projected to have a significant positive impact on residents in states with high property and income taxes. By restoring unrestricted deductibility, taxpayers could potentially benefit from lower federal tax liabilities, thereby increasing their disposable income. Critics, however, argue that such a repeal could disproportionately benefit wealthier individuals and result in a loss of federal revenue that could affect funding for critical public services and programs.
Summary
House Bill 2555, also known as the SALT Deductibility Act, aims to amend the Internal Revenue Code by repealing the existing limitation on the deduction for certain taxes, specifically state and local property and income taxes. This bill is proposed as a way to provide financial relief to taxpayers who have faced restrictions on their ability to deduct these taxes from their federal income tax returns, which has been a contentious issue since the Tax Cuts and Jobs Act of 2017 imposed the $10,000 cap on these deductions.
Contention
Notable points of contention surrounding HB2555 include concerns about the implications of restoring these deductions on overall tax equity and fairness. Opponents argue that the bill favors affluent taxpayers in high-tax states while providing little to no relief for those in lower-income brackets or states with lower taxes. Additionally, there are apprehensions about the long-term budgetary effects, including potential deficits that could arise from the reduced tax revenue as a result of this repeal.
Related
SALT Fairness Act of 2023 This bill repeals the temporary restrictions in taxable years 2018 through 2025 on the deductibility of state and local taxes.
SALT Fairness Act of 2023 This bill repeals the temporary restrictions in taxable years 2018 through 2025 on the deductibility of state and local taxes.
Stop Subsidizing Multimillion Dollar Corporate Bonuses Act This bill extends the $1 million limit on the deductibility of executive compensation to all employees of publicly traded corporations.