Huge Property Tax Relief Measure for NJ is Back on the Table
A huge tax break is back on the table in Washington.
When President Joe Biden's Build Back Better bill died in the Senate last year, so did attempts to modify the so-called SALT cap - or how much state and local tax you can deduct on your federal income tax return.
New Jersey U.S. Sen. Bob Menendez says he is now trying to include changes to the SALT cap in legislation that is designed to lower health care and prescription drug costs.
The former Donald Trump administration capped how much state and local tax you could deduct at $10,000. 4-in-10 New Jersey residents were claiming at least double that number on their federal returns.
New Jersey famously has the highest property taxes in the nation, and the cap hit Garden State taxpayers and others in high tax states particularly hard.
One of the biggest challenges in getting progressive senators like Vermont's Bernie Sanders to go along with changes to SALT has been assurances it will not be used as another tax break for the rich.
Menendez says he is working on that, although the Joint Committee on Taxation has already claimed that two-thirds of those who use the deduction claimed less than $200,000 in income.
Efforts to repeal or raise the SALT cap have been ongoing since it was enacted in 2017.
New Jersey joined three other high tax states in suing the federal government to try and overturn it. The Supreme Court refused to hear the case in April, leaving in place a lower court ruling that upheld broad authority of the federal government to enact tax policy.