SALT Tax Deduction Increase

[Anonymous]

Anonymous wrote:If we’re going to raise a cap, I wish it was the childcare FSA limit. 5k is peanuts compared to the cost of childcare and could help out a lot of families regardless of ability to own a home.

Yeah agreed there. I spent 44k on childcare in 2023. 5K is pretty small FSA limit compared to that. And I only get a few hundred back with the dependent care credit. Yes I’m a high earner and can’t complain about my lot. but I’m spending a ton of take home pay (more than my mortgage) on childcare and the tax benefit does not stack up. Especially when you consider that daycare spend is creating jobs and daycare availability is keeping people with young kids in the workforce.

[Anonymous]

G-d---- it! I just went through a huge hassle last year to set up my business as a pass-through entity to get around the SALT cap, and now they do this??

If our lawmakers are going to make idiotic laws, can't they at least make them so they are somewhat constant?!

[Anonymous]

If you think homeowners have too many tax breaks, the number of tax breaks landlords get would blow your mind.

[Anonymous]

Anonymous wrote:G-d---- it! I just went through a huge hassle last year to set up my business as a pass-through entity to get around the SALT cap, and now they do this??

If our lawmakers are going to make idiotic laws, can't they at least make them so they are somewhat constant?!

Don't worry, even if they pass this, which they won't, it's only in effect for this tax year.

[Anonymous]

Anonymous wrote:

Anonymous wrote:What am I missing?

Standard deduction for married couples filing jointly is $27,700. Adding another $10K to current $10k is still below the standard deduction.

I guess the yay only applies if you are filing single/head of household.

Also, 2023 tax season is already here. Many of the tax softwares have already been coded to current tax laws. Why do they change tax laws so late in the game?

It helps if you are already itemizing. Fro example if you have $10k in current SALT deduction, $5k in charitable donations and $10k in mortgage interest you would be under the standard deductions dot just take that. But if SALT cap is raised to $20k you would be above and would itemize

Who has only $5K in charitable deductions but $10K in mortgage interest? I know this is hypothetical but these numbers are wacky unless you're lower income and house poor.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:What am I missing?

Standard deduction for married couples filing jointly is $27,700. Adding another $10K to current $10k is still below the standard deduction.

I guess the yay only applies if you are filing single/head of household.

Also, 2023 tax season is already here. Many of the tax softwares have already been coded to current tax laws. Why do they change tax laws so late in the game?

It helps if you are already itemizing. Fro example if you have $10k in current SALT deduction, $5k in charitable donations and $10k in mortgage interest you would be under the standard deductions dot just take that. But if SALT cap is raised to $20k you would be above and would itemize

Who has only $5K in charitable deductions but $10K in mortgage interest? I know this is hypothetical but these numbers are wacky unless you're lower income and house poor.

Read the donation threads, those numbers seem legit to me.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:What am I missing?

Standard deduction for married couples filing jointly is $27,700. Adding another $10K to current $10k is still below the standard deduction.

I guess the yay only applies if you are filing single/head of household.

Also, 2023 tax season is already here. Many of the tax softwares have already been coded to current tax laws. Why do they change tax laws so late in the game?

It helps if you are already itemizing. Fro example if you have $10k in current SALT deduction, $5k in charitable donations and $10k in mortgage interest you would be under the standard deductions dot just take that. But if SALT cap is raised to $20k you would be above and would itemize

Who has only $5K in charitable deductions but $10K in mortgage interest? I know this is hypothetical but these numbers are wacky unless you're lower income and house poor.

Is the charitibale deductions higher or lower than you expect with $10K in mortgage interest? We did about $5K in donations and have mortgage interest of $14K. We aren't religious so don't spend our fun money on that.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Im so tired of homeowners and all their endless tax breaks. Homeowners want it all and become NIMBYs. We need to get rid of the SALT deduction, scale back mortgage interest deductions, and start incentivizing multi family housing and renters.

Why would you incentivize renting?

You want to encourage movement in the housing market, instead of people sitting on their sub 3% rates complaining how they're golden handcuffed and can't move. If it was more attractive to rent, you also wouldn't have so much local resistance to creating more housing stock. More supply = better prices for all.

This doesn’t make sense. There’s no social good in having movement in the housing market. People who own homes are more likely to live somewhere long term and invest in the community. People who are just passing through aren’t interested in improving schools, parks, etc because they won’t be around to enjoy them.

What a load of horse sh!t.

Owning a home is not the norm in countries like Germany, Japan, France, etc. All those renters are clearly not invested in their communities and country, right?

[Anonymous]

Anonymous wrote:

Anonymous wrote:It hilarious how liberals and Dems scream about the rich not paying enough taxes and about rampant wealth inequality, yet here they are, demanding the U.S. govt and the rest of the country help subsidize their expensive giant homes with tax deductions.

There should be $0 able to be deducted for owning a home. Why is it my responsibility to give you a tax break for owning a $1M home? Dems, walk the walk if you’re gonna talk the talk. Fork up the taxes since you are telling everyone else to pay more to combat wealth inequality.

No, they are small government advocates who are paying local tax to care for their neighbors, and want a discount off of the subsidies they pay to to low tax states like Texas that suck on the Federal teat.

I really didn’t have a dog in this fight but you can’t say that Democrats are “small government advocates”

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Im so tired of homeowners and all their endless tax breaks. Homeowners want it all and become NIMBYs. We need to get rid of the SALT deduction, scale back mortgage interest deductions, and start incentivizing multi family housing and renters.

Why would you incentivize renting?

You want to encourage movement in the housing market, instead of people sitting on their sub 3% rates complaining how they're golden handcuffed and can't move. If it was more attractive to rent, you also wouldn't have so much local resistance to creating more housing stock. More supply = better prices for all.

This doesn’t make sense. There’s no social good in having movement in the housing market. People who own homes are more likely to live somewhere long term and invest in the community. People who are just passing through aren’t interested in improving schools, parks, etc because they won’t be around to enjoy them.

What a load of horse sh!t.

Owning a home is not the norm in countries like Germany, Japan, France, etc. All those renters are clearly not invested in their communities and country, right?

They have extremely strong rent control and tenant protections in those countries. They rent because it’s actually affordable for an average worker.

[Anonymous]

America is oversold on the concept of housing as an investment leading to homeowners voting against anything that will not increase property value.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:What am I missing?

Standard deduction for married couples filing jointly is $27,700. Adding another $10K to current $10k is still below the standard deduction.

I guess the yay only applies if you are filing single/head of household.

Also, 2023 tax season is already here. Many of the tax softwares have already been coded to current tax laws. Why do they change tax laws so late in the game?

It helps if you are already itemizing. Fro example if you have $10k in current SALT deduction, $5k in charitable donations and $10k in mortgage interest you would be under the standard deductions dot just take that. But if SALT cap is raised to $20k you would be above and would itemize

Who has only $5K in charitable deductions but $10K in mortgage interest? I know this is hypothetical but these numbers are wacky unless you're lower income and house poor.

Our property taxes are 14K and rising fast -- Illinois is like that, there's no brakes. They've doubled in the last three years alone. It cuts into our ability to save and definitely our ability to donate, and it's not uncommon here.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:What am I missing?

Standard deduction for married couples filing jointly is $27,700. Adding another $10K to current $10k is still below the standard deduction.

I guess the yay only applies if you are filing single/head of household.

Also, 2023 tax season is already here. Many of the tax softwares have already been coded to current tax laws. Why do they change tax laws so late in the game?

It helps if you are already itemizing. Fro example if you have $10k in current SALT deduction, $5k in charitable donations and $10k in mortgage interest you would be under the standard deductions dot just take that. But if SALT cap is raised to $20k you would be above and would itemize

Who has only $5K in charitable deductions but $10K in mortgage interest? I know this is hypothetical but these numbers are wacky unless you're lower income and house poor.

Uh, I have $12,000 in mortgage interest and $0 in charitable contributions. Charity is for rich people.

[Anonymous]

Anonymous wrote:

Anonymous wrote:It hilarious how liberals and Dems scream about the rich not paying enough taxes and about rampant wealth inequality, yet here they are, demanding the U.S. govt and the rest of the country help subsidize their expensive giant homes with tax deductions.

There should be $0 able to be deducted for owning a home. Why is it my responsibility to give you a tax break for owning a $1M home? Dems, walk the walk if you’re gonna talk the talk. Fork up the taxes since you are telling everyone else to pay more to combat wealth inequality.

I’m sorry you can’t afford to buy a home.

I own a home and I'm a democrat and I don't agree with raising the SALT cap. I agree with what the PP wrote about it being unbecoming and hypocritical for dems to scream about everyone needing to pay their fair share while requesting handouts from the federal government. If someone wants to buy a house, let alone a massive house, in a small geographical area where schools, police, fire, etc are subsidized by taxes then they need to pony up. SALT is regressive. Own your choices people.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:What am I missing?

Standard deduction for married couples filing jointly is $27,700. Adding another $10K to current $10k is still below the standard deduction.

I guess the yay only applies if you are filing single/head of household.

Also, 2023 tax season is already here. Many of the tax softwares have already been coded to current tax laws. Why do they change tax laws so late in the game?

It helps if you are already itemizing. Fro example if you have $10k in current SALT deduction, $5k in charitable donations and $10k in mortgage interest you would be under the standard deductions dot just take that. But if SALT cap is raised to $20k you would be above and would itemize

Who has only $5K in charitable deductions but $10K in mortgage interest? I know this is hypothetical but these numbers are wacky unless you're lower income and house poor.

Our property taxes are 14K and rising fast -- Illinois is like that, there's no brakes. They've doubled in the last three years alone. It cuts into our ability to save and definitely our ability to donate, and it's not uncommon here.

You are paying for schools, fire, police, town rec programs, road plowing, trash hauling, fireworks, the beach if you are near Lake Michigan. You know all of this and undoubtedly you knew which towns had higher mill rates (that is what they are called in CT, not sure what they are called in IL) and you made a choice. My husband and I live outside of New York City and we chose to move to southern Connecticut (Fairfield County) instead of Long Island, New Jersey, and Westchester because, among other things, the taxes where we live are comparably lower and the schools are still great. Our town has a lot of businesses and that large tax base allows the town to offset property taxes. If we lived in Westchester or New Jersey I would probably be bummed about the high taxes but I would also own that I made a choice to move to that location knowing the taxes were very high.