My family would save over 25% on federal taxes with the two calculators I used.
It appears a large number of two income families up to and over $160,000 would do likewise.
I’m in CA and stuck with high SALT.
But how easy is that? It's like shooting fish in a barrel. Everyone, even liberals (although they won't admit it), want their taxes lowered.
A truly great politician is one who can regularly balance budgets... especially if those budgets are flat or trending downward. Now that's a difficult feat worthy of true praise and support.
Some here at FR think that the rest of the country somehow needs to protect them from living in a dem run state
Hope your flame suit is on
This idea for reforming the tax code is freaking brilliant.
Effective subsidization of state and local taxes really, really, in my view skews the whole relationship between the states and the federal government.
Can’t understand why the real conservatives don’t understand this.
This is an instructive article. These states that have this bogus deduction, are getting away with spending other peoples money.
ping
If they cut spending to any useful extent first, consumer spending, markets, jobs, then revenues will go down. They don’t want to start a vicious cycle.
So they want to cut taxes and take other measures to rev up the economy a little more, then cut spending. Then, they can safely raise interest rates. Otherwise, with the increasing pile of debt, bonds will get even more risky (also a way to start a vicious cycle).
Remember that the Fed raised the rate a few months ago, and the dollar started to fall instead of going up again. That was a warning sign that the previous paradigm was about to fail in a big way.
The one thing you fail to mention about this passing the costs farce is those very same people from those states such as California, New York, New Jersey also shelter the largest tax burdens at THE FEDERAL level. So using your argument of “supplementing” which is liberal code word for it is the government’s money then these very same states are supplementing the rest of the country anyway by paying the majority of federal taxes.
The tax plan is simply garbage, period end of story
This is a good argument, but it’s still going to be painful to have to bear that burden.
What really gets to me is that, as crappy as our Senate is, we are getting EXCELLENT JUDGES SEATED, which may well make the difference as to whether our kids and grand kids live in a country like like Switzerland, as we pretty much are now, or Syria, where we break off into sides and have a vicious civil war.
To me that’s a bit more important than handing the Senate to Schumer so as to protect the precious SALT deduction for a relative handful of conservatives - but many on this site who live in those blue states certainly feel that their precious SALT deduction is MORE IMPORTANT than who sits on the Supreme Courts, the Appellate Courts, and the lower courts.
If that’s the case, I guess their kids deserve the NIGHTMARE country we leave to them...
The author is correct about the corrupting nature of our current tax system built on politically charged vote-buying deductions.
The central / general government was designed to be the lightest (on the individual) and most objective level of our federal system. Since our original number one principle of government was protection of individual freedom from the fed level control. And let states, markets, institutions and individuals worry about everything else.
There was no fed level individual tax. But the 16th changed that unfortunately. Now, there are a couple general ways to achieve a correctly object fed level tax. One, the best, would be a consumption tax - the feds don’t even need to know who you are for that.
The most objectively fair option using income taxes is a true flat tax - with absolutely no deductions for anything. Not for SALT, mortgage, charity... nothing.
Looking at the arguments/comments here only makes the author’s point about the awful and wrong-headed nature of a non-objective system such as our current mess of deductions.
However, the author is wrong about one thing: a flat tax is not flat if there is still a standard deduction.
The R party has control of both the levels and the branches of government. If ever there were a time to devolve power and eliminate fed level special interests, it would be now. Should be, anyway.
Obviously, between Trump and the Hill people there are few freedom lovers in DC and even fewer with the originalist wisdom to pursue objectivity at the fed level. So we are NOT going to do the right thing with this current bill, I realize that.
I would be happy if occasionally, instead of endlessly re-defining winners and losers, to hear maybe one party leader explain that: yes, weaning from addictions hurts; yes, the folks who gave us the current system were wrong and/or evil; and yes, we do wish to minimize/amortize the pain... but, we do intend to move in Objectivity’s direction - it is the only fair path forward.
I think a whole lot of people commenting don’t itemize and don’t really understand the proposal as a result. State and local taxes are deductible on federal tax returns if you itemize, always have been since the beginning in, what, 1913? While it might seem appealing to some conservatives to stick it to high-tax states that are presumably blue (and most but not all are), it’s still a stealth tax increase by removing the deduction. Texas has bizarrely high residential real estate taxes, Florida is on up there too. Need to stop and think about this, it’s going to impact some people pretty badly and quite a few of them are Republican voters or potential Republican voters. It’s not just hardcore leftists being hit with the taxes they love to impose on everybody else. There will be political fallout, and not all of it will be restricted to blue states.
This is such bs. No elected official bases their spending level on how much of a deduction someone is going to get from the feds.
I’m a conservative, live in a red state, and I have losing the state and local tax deductions because it means my federal taxes will be going up. Does that make me a Democrat?
Yep - a number of very irate FReepers who don’t see the hypocrisy of their complaints. Would like to get a look at their finances to see how they have over-leveraged and spent beyond their reasonable means....
Once again, the Republicans are displaying how inept they are at messaging. This article by Bob Barr is a perfect example. He is down in the weeds so deep you can’t see the top of his head. The message behind this is simple: “Should a person making $150,000 in a high-tax State like New York or California pay less in Federal tax than someone earning the same amount in a lower tax State like Alabama or Nebraska? The SALT deduction creates this exact scenario.
Others posting before me are saying their taxes will go up if this is eliminated. For some, that may be true - but you have to look at the totality of the bills being proposed to know if this is true, and not just one element of the bill. So if you lose the SALT deduction, but you double your personal exemption and reduce your tax rate, what then is the NET effect on your tax bill?
To me, the best way to assess Federal taxes fairly is with a low flat-tax rate that applies equally to everyone, and no deductions at all. A fall-back position would be the “Fair Tax”, that was a popular solution among conservatives and the Tea Party 10-20 years ago. If you recall him, this was popularized by Atlanta talk-show host Neal Boortz (a libertian).
When Houston built the Texans stadium for the $300,000,000 the naming rights were sold for $300,000,000 and that money was given to the team owner. WTF???
He didn’t build that. He plays less than a dozen games there. And he gets the cash????
Worst management of city assets ever.
And it goes like that down the list (public to private transfer of wealth and assets).
Projects can be paid for without hitting up taxpayers but it’s so easy to do it and it keeps the connected well oiled.
Ping
Good luck with that