2025 SALT Deductions

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:if your MAGI is under $500,000. Phases down to $10,000 if MAGI is over $600,000

As it should

Why “as it should”? Why should I be punished for my financial acumen and success?

You aren’t being “punished.” Change your framing.

Enlighten me. The government is taking more from me because I make more despite the epic amount of wasteful govt spending. That seems like punishment to me.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:if your MAGI is under $500,000. Phases down to $10,000 if MAGI is over $600,000

As it should

Not necessarily - it still encourages wealthy people to move to Florida or Texas or other no/low tax states.

wealthy people don't want to live in texas or florida.

If someone moves from a livable state to Texas or Florida simply to save a few thousand dollars on taxes they'll get exactly what they deserve.

It's the same as when I see people here saying they're living in VA because of the taxes. Like if you want to live in VA because you want to live in VA go for it, but if you actually prefer to live in DC and you're living somewhere you don't really want to be to save a piddly few percent on taxes that's just sad and pathetic. Hope that long commute from your soulless suburb is really worth the extra few bucks.

Huh? If you make $1M you’re saving a hell of a lot more than a few percent between DC and VA. And your commute is probably shorter if you’re traveling from say Lyon Village or Ashton Heights to downtown DC vs coming from Spring Valley or Kent to downtown DC. VA on $1M you pay $58K. In DC you pay $90-100K. Maybe you haven’t hit that income yet so you don’t understand though?

The difference between $90k and $58K is $32K, which is about 3% of $1,000,000. The number 3 is generally regarded as well within the normal usage of "a few." But maybe you haven't hit elementary school math yet so you don't understand though?

That's a nice gift or a trip. All that for the prestige of living in a place like DC?

It’s prestigious to live in DC? Really? I must have missed the memo on that. Why is living in a crime-infested poorly governed city like DC considered prestigious?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:if your MAGI is under $500,000. Phases down to $10,000 if MAGI is over $600,000

As it should

Not necessarily - it still encourages wealthy people to move to Florida or Texas or other no/low tax states.

wealthy people don't want to live in texas or florida.

If someone moves from a livable state to Texas or Florida simply to save a few thousand dollars on taxes they'll get exactly what they deserve.

It's the same as when I see people here saying they're living in VA because of the taxes. Like if you want to live in VA because you want to live in VA go for it, but if you actually prefer to live in DC and you're living somewhere you don't really want to be to save a piddly few percent on taxes that's just sad and pathetic. Hope that long commute from your soulless suburb is really worth the extra few bucks.

Huh? If you make $1M you’re saving a hell of a lot more than a few percent between DC and VA. And your commute is probably shorter if you’re traveling from say Lyon Village or Ashton Heights to downtown DC vs coming from Spring Valley or Kent to downtown DC. VA on $1M you pay $58K. In DC you pay $90-100K. Maybe you haven’t hit that income yet so you don’t understand though?

The difference between $90k and $58K is $32K, which is about 3% of $1,000,000. The number 3 is generally regarded as well within the normal usage of "a few." But maybe you haven't hit elementary school math yet so you don't understand though?

That's a nice gift or a trip. All that for the prestige of living in a place like DC?

It’s prestigious to live in DC? Really? I must have missed the memo on that. Why is living in a crime-infested poorly governed city like DC considered prestigious?

+1

[Anonymous]

Then why are those high earners living there?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:if your MAGI is under $500,000. Phases down to $10,000 if MAGI is over $600,000

And if you itemize. I wonder how many people: 1) have state tax deductions over $10k, 2) make under $600k MAGI, and 3) itemize. In many states, if you itemize federal then you have to itemize state too, and if you're only substantial itemized deduction is state taxes, then you'll get no deduction at all at state level (since state taxes are not deductible on state taxes). That seems like a pretty small universe.

Odds are you're itemizing if you're paying mortgage interest, no? Between SALT and interest, that's enough to get us over the standard deduction even before we take charitable donations into account. Especially now that the SALT cap is significantly higher than the standard deduction amount.

Before the SALT cap was introduced in 2017, 80% of households making between $100-500K were itemizing. After the cap was set at 10K only 22.5% itemized. Raising the cap again is going make a huge difference, especially in this area.

The standard deduction was also doubled in 2018, so that definitely had an impact. A lot more people in HCOL areas will itemize now, people in LCOL places will still have a hard time hitting $30K+ in itemized deductions.

Yep. The standard deduction for a couple is $31,500 this year. Even with state taxes, it will be hard for most people to get over that in itemized deductions even with the increased limits. I’d imagine this will only really help folks in the $400-$500k range.

Guess where my wife is and has to pay the ridiculous PHL tax on top of state/mortgage.

It's nice that you are very proud of your doctor wife who lives in Philadelphia, but I think the rest of us have heard enough about her.

They were direct responses to questions in the thread. Since it's anon, I had to give the info of the particular case where it applies. You could have just kept reading instead of being a ****

Please point to the question in the above thread.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:if your MAGI is under $500,000. Phases down to $10,000 if MAGI is over $600,000

And if you itemize. I wonder how many people: 1) have state tax deductions over $10k, 2) make under $600k MAGI, and 3) itemize. In many states, if you itemize federal then you have to itemize state too, and if you're only substantial itemized deduction is state taxes, then you'll get no deduction at all at state level (since state taxes are not deductible on state taxes). That seems like a pretty small universe.

Odds are you're itemizing if you're paying mortgage interest, no? Between SALT and interest, that's enough to get us over the standard deduction even before we take charitable donations into account. Especially now that the SALT cap is significantly higher than the standard deduction amount.

Before the SALT cap was introduced in 2017, 80% of households making between $100-500K were itemizing. After the cap was set at 10K only 22.5% itemized. Raising the cap again is going make a huge difference, especially in this area.

The standard deduction was also doubled in 2018, so that definitely had an impact. A lot more people in HCOL areas will itemize now, people in LCOL places will still have a hard time hitting $30K+ in itemized deductions.

Yep. The standard deduction for a couple is $31,500 this year. Even with state taxes, it will be hard for most people to get over that in itemized deductions even with the increased limits. I’d imagine this will only really help folks in the $400-$500k range.

Guess where my wife is and has to pay the ridiculous PHL tax on top of state/mortgage.

It's nice that you are very proud of your doctor wife who lives in Philadelphia, but I think the rest of us have heard enough about her.

They were direct responses to questions in the thread. Since it's anon, I had to give the info of the particular case where it applies. You could have just kept reading instead of being a ****

Please point to the question in the above thread.

To add, you mentioned her three times in this thread, none of which were in response to a direct question. Just drop it. Or is your self esteem so low that the only way you can prop it up is with the reflected glory of your "Dr wife?"

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:if your MAGI is under $500,000. Phases down to $10,000 if MAGI is over $600,000

As it should

Why “as it should”? Why should I be punished for my financial acumen and success?

You aren’t being “punished.” Change your framing.

Enlighten me. The government is taking more from me because I make more despite the epic amount of wasteful govt spending. That seems like punishment to me.

DP. You have more discretionary spending.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:if your MAGI is under $500,000. Phases down to $10,000 if MAGI is over $600,000

As it should

Why “as it should”? Why should I be punished for my financial acumen and success?

You aren’t being “punished.” Change your framing.

Enlighten me. The government is taking more from me because I make more despite the epic amount of wasteful govt spending. That seems like punishment to me.

DP. You have more discretionary spending.

Actually the government has even more discretionary spending. That should be cut significantly so I’m not taxed for my success.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:if your MAGI is under $500,000. Phases down to $10,000 if MAGI is over $600,000

As it should

Why “as it should”? Why should I be punished for my financial acumen and success?

You aren’t being “punished.” Change your framing.

Enlighten me. The government is taking more from me because I make more despite the epic amount of wasteful govt spending. That seems like punishment to me.

Then you have a puerile understanding of how things work.

Our income tax is progressive. You pay more because you have the ability to pay more and have also disproportionately benefited from the public goods that facilitated your income and wealth. It isn’t “punishment.” On the contrary.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:if your MAGI is under $500,000. Phases down to $10,000 if MAGI is over $600,000

As it should

Why “as it should”? Why should I be punished for my financial acumen and success?

You aren’t being “punished.” Change your framing.

Enlighten me. The government is taking more from me because I make more despite the epic amount of wasteful govt spending. That seems like punishment to me.

Then you have a puerile understanding of how things work.

Our income tax is progressive. You pay more because you have the ability to pay more and have also disproportionately benefited from the public goods that facilitated your income and wealth. It isn’t “punishment.” On the contrary.

Thanks Karl

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:if your MAGI is under $500,000. Phases down to $10,000 if MAGI is over $600,000

As it should

Why “as it should”? Why should I be punished for my financial acumen and success?

You aren’t being “punished.” Change your framing.

Enlighten me. The government is taking more from me because I make more despite the epic amount of wasteful govt spending. That seems like punishment to me.

Then you have a puerile understanding of how things work.

Our income tax is progressive. You pay more because you have the ability to pay more and have also disproportionately benefited from the public goods that facilitated your income and wealth. It isn’t “punishment.” On the contrary.

I agree with progressive taxation, because I don't know how else we could reasonably fund our society. But I'm a little annoyed at the constant "disproportionately benefited" trope. Are those who pay less or even no income taxes not significantly benefited by "the public goods" paid for by others taxation?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:if your MAGI is under $500,000. Phases down to $10,000 if MAGI is over $600,000

As it should

Why “as it should”? Why should I be punished for my financial acumen and success?

You aren’t being “punished.” Change your framing.

Enlighten me. The government is taking more from me because I make more despite the epic amount of wasteful govt spending. That seems like punishment to me.

Then you have a puerile understanding of how things work.

Our income tax is progressive. You pay more because you have the ability to pay more and have also disproportionately benefited from the public goods that facilitated your income and wealth. It isn’t “punishment.” On the contrary.

I don't think you sell taxation by justifying it by claiming people who have more money disproportionately benefitted from public goods. It doesn't work that way. In fact, public goods are mostly designed to benefit the public at large. And if public goods disproportionately benefit the wealthy, doesn't that make them by definition biased?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:if your MAGI is under $500,000. Phases down to $10,000 if MAGI is over $600,000

As it should

Why “as it should”? Why should I be punished for my financial acumen and success?

You aren’t being “punished.” Change your framing.

Enlighten me. The government is taking more from me because I make more despite the epic amount of wasteful govt spending. That seems like punishment to me.

Then you have a puerile understanding of how things work.

Our income tax is progressive. You pay more because you have the ability to pay more and have also disproportionately benefited from the public goods that facilitated your income and wealth. It isn’t “punishment.” On the contrary.

I don't think you sell taxation by justifying it by claiming people who have more money disproportionately benefitted from public goods. It doesn't work that way. In fact, public goods are mostly designed to benefit the public at large. And if public goods disproportionately benefit the wealthy, doesn't that make them by definition biased?

The argument is that the wealthy were only able to get that way due to government spending that provided the stability (and infrastructure/basic research) for capitalism to flourish.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:if your MAGI is under $500,000. Phases down to $10,000 if MAGI is over $600,000

As it should

Why “as it should”? Why should I be punished for my financial acumen and success?

You aren’t being “punished.” Change your framing.

Enlighten me. The government is taking more from me because I make more despite the epic amount of wasteful govt spending. That seems like punishment to me.

Then you have a puerile understanding of how things work.

Our income tax is progressive. You pay more because you have the ability to pay more and have also disproportionately benefited from the public goods that facilitated your income and wealth. It isn’t “punishment.” On the contrary.

I don't think you sell taxation by justifying it by claiming people who have more money disproportionately benefitted from public goods. It doesn't work that way. In fact, public goods are mostly designed to benefit the public at large. And if public goods disproportionately benefit the wealthy, doesn't that make them by definition biased?

The argument is that the wealthy were only able to get that way due to government spending that provided the stability (and infrastructure/basic research) for capitalism to flourish.

How does that justify progressive taxation? We tax progressively because poor people don't have any money, not because people who have higher incomes benefitted disproportionately from the system of public goods.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:With SALT deduction in 2025, that would push us to itemize, and would give us the full benefit of charitable deductions right? (Unlike in 2026, when there are more limitations on charitable deductions.) Trying to get a handle on the full scale of the tax savings.

The limits are pretty loose — you can't deduct the first .05% of your charitable donations. For my family, that knocks off about $200 in deductible donations, but we typically deduct more than $10,000 a year in charitable giving, so I don't really intend to change anything because of that tax change.

Sorry, that's not right — typo. It's first .5%, and we lose about $2,000 in deductible donations. Still not planning to give less.

That’s not right. The limit isn’t the first 0.5% of the deduction, it’s 0.5% of your AGI. So if your AGI is $400k, you lose $2k in deductions.