Excerpt:
The Illinois congressional delegation is thus far standing firm in its bid to repeal the $10,000 cap on state and local tax deductions—albeit strictly along party lines.
It’s become a potentially divisive issue for Democrats—just as Republicans intended when the cap was instituted as part of the Trump tax cuts at the end of 2017. But it’s also proved to cut both ways.
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A 2018 report issued by Chicago-area Democratic representatives, using data compiled by the Institute for Taxation and Economic Policy, found that 500,000 metro households felt the pinch to some extent, including 71,000 of 170,000 homeowners in the 6th District, where Casten unseated Roskam and is now trying to hold off Rep. Marie Newman after redistricting.
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But repealing the cap has threatened to open a divide between Democratic progressives and traditional liberals. For progressives like Sen. Bernie Sanders of Vermont it’s also a fairness issue, in that if he insists that the richest Americans pay more in taxes, that also goes for Democrats in that group. He’s suggested repealing the SALT cap only up to household incomes of $400,000, citing President Biden’s like-minded campaign pledge that he would not raise taxes on those earning up to that amount.
Author(s): Ted Cox
Publication Date: 26 Jan 2022
Publication Site: Crain’s Chicago Business