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Aren't the tax laws of the blue states cruel to it's residents?
I don't understand your line of thinking...
Blue state governments can tax about anything they want at ridiculous rates, and you are complaining about one addition of the Federal tax system.
Why aren't you complaining about state taxes?
Live in a blue state and I agree. When Illinois raised it's income tax in 2017, they did it retroactively. So no matter what, you had no way to do any tax planning. At least with the Tax Act, you knew these changes were coming and we paid our real estate taxes in 2017 so we could get the full deduction. Obviously, you can't do that going forward. Oh, and Illinois also screwed people who make over $500k by disallowing them to deduct ANY real estate taxes.
How are the federal tax laws "cruel to blue staters"? The tax law is the same for all people (now), regardless of which state you live in-at least after you hit the SALT deduction limit. Previously two individuals that made the same amount of money paid a different amount of federal income tax, depending on the state tax they paid. How was it not cruel to "red staters" to have to subsidize the federal income tax of "blue staters"?
And even in blue states-it's only the rich with large amounts of mortgage interest and state taxes that are impacted, not the lower or low-median middle class taxpayer that is impacted. After all, the standard deduction for a married couple is $24,000. Now-don't we all think the rich should pay "their fair share"? Though, to be honest-even with the SALT deduction limit, they may still pay less, due to the tax rates being lower.
Single standard deduction is chump change for a high property tax state like Texas. Whether they ask for it or not is questionable, but they should have done it gradually so that they could adjust. What if they were depending on a refund to pay for kids college tuition, student loan, mortgage etc?
Wait until the impact of the SALT deduction limit ripples through the housing market. When people figure out that the tax deductible incentives of home ownership have been effectively eliminated, residential real estate values are going to decrease dramatically. Tax incentives for buying a house have been a major factor for decades.
This is correct. I have been saying it for almost a year. The market in our area has declined about 20% since 2016.
How are the federal tax laws "cruel to blue staters"? The tax law is the same for all people (now), regardless of which state you live in-at least after you hit the SALT deduction limit. Previously two individuals that made the same amount of money paid a different amount of federal income tax, depending on the state tax they paid. How was it not cruel to "red staters" to have to subsidize the federal income tax of "blue staters"?
And even in blue states-it's only the rich with large amounts of mortgage interest and state taxes that are impacted, not the lower or low-median middle class taxpayer that is impacted. After all, the standard deduction for a married couple is $24,000. Now-don't we all think the rich should pay "their fair share"? Though, to be honest-even with the SALT deduction limit, they may still pay less, due to the tax rates being lower.
Wrong. You don't know how taxes work. We have progressive taxes in this country. The more you make, the more you pay. The more you make, your effective tax rate gets closer and closer to 37%.
It was purposely done to get more taxes from California, Illinois, NY, NJ, Conn, Mass....and it was designed to allow resident in the red states to pay less...masterful.
Well, for years I have lived in red states and paid MORE in TAXES so rich folks in California, Illinois, NY, NY, Conn, Mass......paid less due to deductions for state and local taxes
I NEVER made over 80,000 a year in my entire life.....why should I pay so RICH FOLKS get their deductions??
Citizens in every state get education and services provided. Paying more in taxes does not guarantee better quality of either. I grew up in NYS, with a horribly high tax rate, both on income and property. Guess what? The roads and parks are not in any better shape than here in Idaho (which has about 1/3 the property tax rate). The schools are little different. The roads get plowed. After seeing the road conditions in CA, particularly the LA area-I can certainly say those taxpayers are not getting their money's worth.
Now-if the citizens of blue states do want better services-they should be willing to pay for them-not push their tax burden off to places like Mississippi, Alabama or the rest of the American Bangladesh.
I agree with this part. Illinois has some of the highest taxes in the country and the roads are shi$. And even after all of that, they still elected all Democrats to everything and they are going to raise state taxes a huge amount.
I admit that the new tax law did affect me badly in some ways, but nothing compared to the way that it did my friends in California. My best friend didn’t even want to talk about it when I asked him. He said that it was the FIRST time that he ever OWED $ back. It seems to me that it hit them like a sudden earthquake. Then, I recalled the way that Reagan instituted his Tax Reform back in 1986. I was only in my 20s then, but remember that the estate tax was raised GRADUALLY from $600,000 to higher amounts over time. The credit card debt went from a 100% deduction GRADUALLY to lower deductible percentages each year. Bottom line, it gave taxpayers some time to prepare! The way in which these tax increases were rolled out seems too sudden and like simple retribution. No matter what, we are all still Americans whether we live in a blue or red state. I think that Reagan understood that regardless of his other faults.
In addition, I understand that the $10000 SALT limit will NOT increase with inflation (home price appreciation and tax increases). That also puts an additional TAX INCREASE over time for those ppl.
You are seriously suggesting that it is the obligation for Texans (you and me) to subsidize the California State Income Taxes ..... REALLY? REALLY? People are escaping that gimme-gimme State in droves.
My Sister & her husband (solid, solid Liberals) left California the very second he retired with his State Pension from the University of California as a Tenures Prof with a $150,000 pension and headed for a NO Income tax State. They did this several years ago - and while they complain constantly about OrangeManBad .... they love the Stock Market and the new Tax Reform.
How about if your friend and all his/her friend start trying to get California to stop taxing THEM to death and expecting TaxPayers in other States to subsidize them. IF you friend was clueless about what the Tax Reform was going to be ...... perhaps he/she/it should start paying attention to Reality instead of getting "news" in an Echo Chamber.
Single standard deduction is chump change for a high property tax state like Texas. Whether they ask for it or not is questionable, but they should have done it gradually so that they could adjust. What if they were depending on a refund to pay for kids college tuition, student loan, mortgage etc?
That wouldn't be very smart giving the govt use of your money all year to give it back to you and keep the interest they made off it.
Citizens in every state get education and services provided. Paying more in taxes does not guarantee better quality of either. I grew up in NYS, with a horribly high tax rate, both on income and property. Guess what? The roads and parks are not in any better shape than here in Idaho (which has about 1/3 the property tax rate). The schools are little different. The roads get plowed. After seeing the road conditions in CA, particularly the LA area-I can certainly say those taxpayers are not getting their money's worth.
All roads, parks, and schools should be privatized and paid for through user fees.
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