Trump's "big, beautiful bill" includes a significant increase in the SALT cap. What it means for homeowners.
New York City-area Republican members of the House of Representatives are doing a victory dance because they were able to include a huge increase in property tax deductions in the so-called "big, beautiful bill" passed on Thursday.
Details of the SALT cap increase
Raising the SALT cap was no small accomplishment.
By banding together and refusing to support President Trump's tax bill unless they got what they wanted, the Republican congressmen were able to increase deductions that will ease the burden of property taxes for about 90% of homeowners in New York. It's also a win for people in New Jersey and Connecticut.
- Under the bill, taxpayers can now deduct up to $40,000 annually in state and local taxes -- up from the current $10,000.
- There is a $500,000 income limit to get the deduction. If you make more than that, you get the $10,000 deduction.
- The cap will rise by 1% annually for 10 years, when it will be $45,000, and it goes into effect for the 2025 tax year.
Tax bill benefits to Tri-State Area residents
According to CBS News New York's Marcia Kramer, there are other things in the tax bill that New Yorkers will be happy about, including no tax on tips, which was a campaign promise made by the president. New York, for example, has a huge hospitality industry that employs more than 250,000 people.
In addition, there will no longer be a tax on overtime for anyone. Looking at the construction industry, there are over half a million people who who have various jobs, including electricians, plumbers, metal workers, and people who fix the subways.
Reaction swift on both sides of the aisle
Upstate Republican Rep. Mike Lawler called the passage of the tax bill, "a big deal."
"If we did not pass this bill, the fact is it would have been the single-largest tax increase in American history," Lawler said. "And for my Democratic colleagues who are out there criticizing us, saying that it's not enough, the fact is that when they had complete control of Washington they got exactly zero dollars in an increase for SALT -- zilch, nada zip. So for Chuck Schumer or Hakeem Jeffries, or any Democrat, to criticize us, they should be thanking us."
Democrats are upset about cuts to Medicare and Medicaid, affordable housing, and clean energy projects. Gov. Kathy Hochul says the Republicans, "caved to the billionaire class at the expense of the constituents they serve."
