Republicans clash over 'SALT' deduction as they seek to extend Trump's tax law
Some House Republicans are demanding an increase to SALT deduction in order to support an extension of President-elect Donald Trump's tax law next year.
WASHINGTON — A group of House Republicans representing high-tax states is demanding an increase to the federal deduction for state and local taxes, also known as “SALT,” in order to support an extension of President-elect Donald Trump's tax law next year.
The battle centers on the $10,000 limit on deductions for state and local taxes, which Republicans established in a 2017 tax cut bill. The policy hit hardest in states like New York, New Jersey and California. And with the GOP set to hold a paper-thin House majority of 220-215, some Republicans in those states say they'll exert leverage to expand the tax break in service of their constituents.
“Two-seat majority; eight or 10 very SALT-y Republicans? You guys can do the math on that one,” Rep. Nick LaLota, R-N.Y., a proponent of a bigger SALT deduction, told NBC News.
LaLota, who represents a Long Island-based district where SALT is a major issue, clashed last year with GOP leaders who favor restricting the deduction. This week he said it’s not enough to double the deduction to $20,000, as some have proposed, making it clear he wants “more” than that.
The GOP can afford no more than two defections to pass its planned bill, assuming Democrats are united in opposition. The pro-SALT Republicans are a minority in their party, but they hold a key advantage: Major parts of the 2017 tax law expire at the end of 2025, meaning the SALT cap would go away and tax filers could deduct unlimited amounts of state and local taxes on their federal returns absent congressional action.
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