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Placing the cap on the deduction hurt a lot of people who have to live where real estate is expensive and the homes are smaller for the money, and it got into the new tax code as an attack upon Bluer states, which are the giving states, always putting more money into the US Federal treasury that they receive back in Federal spending. This was done in order to help finance the outrageous tax cuts the global corporations and the filthy rich like Trump. The cap should be removed.
You made the unsubstantiated claim that Democrats want to "raise taxes on most americans and overall, give a tax cut to their key donors " which you have still not given any evidence for.
How much more or less has Trump paid in taxes compared to the prior 10 years after his tax cuts?
Fact is neither you or I know - so stop posting blatant lies.
Corporate taxes are not progressive. Hurts American only companies for than large cap multinationals.
Look at the 1 Trillion of foreign capital repatriated back to the united states from overseas since the tax cuts.
Raise corporate taxes? Apple, Microsoft, IBM, ect keep their overseas profits overseas and pay no taxes on them. Smaller business that do business mostly in the united states? Effects them a lot more.
A family of 4 earning 200k in New York or Cali would likely see an effective increase in federal taxes due from this deduction of 3k. This is equally offset by reduction in the federal tax rate. Maybe your argument is they don't benefit from having their state taxes being double what mine are? Where does all that money go? Supposedly it is for the benefit of the people in the state. Florida is comparable in being a large state that is a heavy tourist destination state yet it has a tax rate of 0%. Is that extra 13% withheld in California really worth it?
Where it really starts to kick in is familys making 400k+. That is def no longer middle class though.
CA I cannot speak to. It's so messy. I don't know how anyone lives there. It's all nuts. Them of all states should just get out of the fed game all together.
I'm in NE. MA state taxes, OTOH, aren't too far off from Arizona. We're at 5.05%. It's reasonable. People here are always fighting about it, but stuff needs to get paid for. I don't know how states with no state income tax do it. Are they relying on other states? Anyhow, between the cost of housing, insurance, and subsequent property taxes it's all pretty expensive in comparison. And that is doable, but as i mention, I don't think MA should be paying more in taxes to the fed then it gets back. That money should go back to the taxpayer to offset.
So, from my point of view is where the heck is all the fed money going? I know where my state taxes go. I see it everyday. With the feds all i see is gross waste.
CA I cannot speak to. It's so messy. I don't know how anyone lives there. It's all nuts. Them of all states should just get out of the fed game all together.
I'm in NE. MA state taxes, OTOH, aren't too far off from Arizona. We're at 5.05%. It's reasonable. People here are always fighting about it, but stuff needs to get paid for. I don't know how states with no state income tax do it. Are they relying on other states? Anyhow, between the cost of housing, insurance, and subsequent property taxes it's all pretty expensive in comparison. And that is doable, but as i mention, I don't think MA should be paying more in taxes to the fed then it gets back. That money should go back to the taxpayer to offset.
So, from my point of view is where the heck is all the fed money going? I know where my state taxes go. I see it everyday. With the feds all i see is gross waste.
I've only been to Massachusetts a few times - but it's taxes seem somewhat middle of the road.
It ranks #4 among states with highest median income (5 if you include D.C.).
That is the nature of progressive taxes though - the more you make the more you pay.
I posted earlier I am for a change in structure of long term capital gains tax. Ideally it should not be raised on anyone making under say 2-300k a year, but knowing government if they change it they will likely hit the middle class equally hard when currently the ultra rich are the massive beneficiaries of it. I could also support removing the cap on social security deduction - the people who make right near the cap for it like me are the ones who really get screwed. I'm sure I'll eventually be over the cap but still support it in order to keep social security afloat.
Glad you see your state taxes. Mine are 7% and the roads are still crap. A large amount of the federal budget goes to the military which you obviously don't see every day. A new B-21 raider will cost $600 million or so a pop but is something I think we need to have but hopefully don't have to use. These tend to be manufactured and based remote areas of the midwest. We will need at least 100 of these - that is massive 60 billion right there. (B-21 is actually scheduled to be built in Cali but current B-2 spirit bombers usually fly out of Missouri - every single long flight usually cost millions due to things such as special coatings that have to be reapplied)
The SALT tax deduction she took on her US 1040 for...
2017: $245,500
2018: just $10,000
The $235,500 over $10,000 she could no longer deduct in 2018 and going forward was taxed at her marginal rate, likely at 37% which would be an extra $87,135 in federal income tax. That's NOT a tax cut; it's a tax INCREASE on the rich.
To further illustrate the point, examples:
$150,000 household pays $15,000 in SALT.
Deduct $10,000. Taxed on that extra $5,000 at 22% marginal tax rate = $1,100
$1.5 million household pays $150,000 in SALT.
Deduct $10,000. Taxed on that extra $140,000 at 37% marginal tax rate = $51,800
There's a 10 times difference in household income and SALT between the two households, but the top 1%-er is paying about 50 timesmore in extra tax than the middle class household due to the new SALT deduction limit.
Understand? But Biden and the Dems want to repeal the $10,000 SALT deduction limit and reinstate the formerly unlimited deduction. That's a HUGE tax break for the rich, thanks to Biden and the Dems.
I am trying to understand this. You seem to be skipping the middle. Where is the 200-350K folk? Anyone paying 245K in property taxes is wealthy. I'm not arguing your point there. I think I get it. Although, anyone paying 15K in SALT in a blue state...that doesn't make sense. How is a 200K (to use my example) homeowner with children paying 15K in SALT? And maybe you can do some magic with the numbers! That would be appreciated. So, SALT in MA for a humble home of 350k all combined would easily be around 35K and that doesn't include the loss of exemptions, which for a family of 4 or 5 is 16-20k. That is potentially 40K+ off the top, which lowers that tax rate to your 150K, but without it that family is closer to 175K. That's not a ton of money, but even with the lower tax rate they are paying more and a few thousand makes all the difference for the middle class. Am I figuring this wrong?
that is why I'm thinking it would make more sense for states to all pay evenly and the over payments can go back.
I am trying to understand this. You seem to be skipping the middle. Where is the 200-350K folk? Anyone paying 245K in property taxes is wealthy. I'm not arguing your point there. I think I get it. Although, anyone paying 15K in SALT in a blue state...that doesn't make sense. How is a 200K (to use my example) homeowner with children paying 15K in SALT? And maybe you can do some magic with the numbers! That would be appreciated. So, SALT in MA for a humble home of 350k all combined would easily be around 35K and that doesn't include the loss of exemptions, which for a family of 4 or 5 is 16-20k. That is potentially 40K+ off the top, which lowers that tax rate to your 150K, but without it that family is closer to 175K. That's not a ton of money, but even with the lower tax rate they are paying more and a few thousand makes all the difference for the middle class. Am I figuring this wrong?
that is why I'm thinking it would make more sense for states to all pay evenly and the over payments can go back.
Are you talking a home worth 350k or an annual household income of 350k?
If household income of 350k that is def upper middle class and not middle class.
Figure for Middle class a SALT deduction is effectivley a 1:4 return on federal taxes.
1:3 for upper middle class.
These two brackets benefited from the federal rates for the low to high 100k incomes going from 32%>28% and 28%>24%.
It takes a large amount of state tax deductions to offset these federal taxes (Remember a deduction essentially being basically 1:4 or 1:3).
Now did the people in the lower income of the "upper middle class" in high tax states benefit less than those in low tax states? Of course. I could see an argument in raising it to 15-20k - but removing it only benefits the wealthy.
If you are only paying 15k in state taxes then the federal reduction outweighs your loss of the full salt deduction. A lot of people who previously itemized (me included - my SALT deduction probably being around 11k) no longer itemize due to large increase in standard deduction.
I am trying to understand this. You seem to be skipping the middle. Where is the 200-350K folk? Anyone paying 245K in property taxes is wealthy. I'm not arguing your point there. I think I get it. Although, anyone paying 15K in SALT in a blue state...that doesn't make sense. How is a 200K (to use my example) homeowner with children paying 15K in SALT?
Is that a joke? In most blue states, real estate tax plus state income tax EASILY exceeds $10,000/year for even modest income households. When I lived in IL, the real estate tax on my average neighborhood home was over $19,000/year. Then, add state income tax. (That's why I no longer live there. I live in a red state, now.)
To see what I'm talking about, consider the annual real estate bill on this modest home in Maywood (in Cook County, IL):
Quote:
Cook County says the Maywood boyhood home of Illinois Black Panther Party leader Fred Hampton is worth $141,920.
Its tax bill: $8,430, or an effective property tax rate of about six percent.
Property tax rates that high, at more than five times the national average, have become standard in inner-ring Chicago suburbs such as Maywood."
And maybe you can do some magic with the numbers! That would be appreciated. So, SALT in MA for a humble home of 350k all combined would easily be around 35K and that doesn't include the loss of exemptions, which for a family of 4 or 5 is 16-20k. That is potentially 40K+ off the top, which lowers that tax rate to your 150K, but without it that family is closer to 175K. That's not a ton of money, but even with the lower tax rate they are paying more and a few thousand makes all the difference for the middle class. Am I figuring this wrong?
that is why I'm thinking it would make more sense for states to all pay evenly and the over payments can go back.
The fault in your proposal: Retirees move out of high-COL blue states to lower-taxed red states because that's all they can afford on their fixed incomes, and their federally-funded SS and Medicare benefits (a HUGE portion of US annual spending) follows them there.
Is that a joke? In most blue states, real estate tax plus state income tax EASILY exceeds $10,000/year for even modest income households. When I lived in IL, the real estate tax on my average neighborhood home was over $19,000/year. Then, add state income tax. (That's why I no longer live there. I live in a red state, now.)
To see what I'm talking about, consider the annual real estate bill on this modest home in Maywood (in Cook County, IL):
The fault in your proposal: Retirees move out of high-COL blue states to lower-taxed red states because that's all they can afford on their fixed incomes, and their federally-funded SS and Medicare benefits (a HUGE portion of US annual spending) follows them there.
19k a year on property tax....eeesh. Maybe some of these places will half by cutting the police budgets (joking of course).
Again I've never seen a breakdown on how the figure federal money received/paid by states. Do they include SALT deductions? SS and Medicare makes sense and I bet that is most likely included.
Ideally capitalism works by encouraging people to move out of these high COL areas to lower COL areas.
if it looks like Biden would win, millions of people will be pulling all of their money out of the stock market. The promise of higher taxes and more regulations will destroy the economy....
if it looks like Biden would win, millions of people will be pulling all of their money out of the stock market. The promise of higher taxes and more regulations will destroy the economy....
I'm not really a person to trade options but I'm considering a signficiant amount on a select few tech companies right now - they have seen their valuations explode simply due to being less effected by corona virus without any underlying growth. I think once coronavirus reduces there will be a heavy re balancing back into value like we saw 1.5 years ago.
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