Congressman Lawler Introduces Bipartisan Bills To Increase SALT Cap; Eliminate Marriage Penalty
Real Estate In-Depth | January 24, 2023
CLARKSTOWN—Newly installed U.S. Rep. Mike Lawler has followed up his recently introduced bill to prevent the implementation of congestion pricing in Manhattan with new bipartisan legislation that would drastically change the SALT Cap and eliminate the SALT Cap marriage penalty.
U.S. Reps. Mikie Sherrill (NJ-11) and Mike Lawler (NY-17) announced on Jan. 31 they had introduced the Middle-Class Tax Relief Act, bipartisan legislation that they say will provide significant relief from the unfair double taxation of the state and local tax (SALT) deduction cap to millions of families and eliminate one of the most significant marriage penalties in the tax code.
This legislation would raise the cap on SALT deductions from $10,000/household to $100,000/single filer and $200,000/married couple. The 2017 Trump Tax Act imposed a $10,000 cap on the SALT deduction.
“There’s a reason New York leads the nation in out-migration and it has nothing to do with the weather. The cost-of-living is crushing families of all backgrounds and the SALT cap is a big reason why. Double-taxing residents of high tax states is unjust and unfair, and I’m proud to work with Congresswoman Mikie Sherrill and other members on both sides of the aisle to get families the relief they need. The Tax Relief for Middle Class Families Act will lift the cap on the SALT contribution by tenfold, giving real relief to families across our country,” said Rep. Lawler.
Earlier in the month, at a press conference on Jan. 23 Republican U.S. Rep. Lawler (R-NY-17), along with Rockland County Executive Ed Day, Clarkstown Town Supervisor George Hoehmann, Ramapo Supervisor Michael Specht, Orangetown Supervisor Teresa Kenny, and Stony Point Supervisor Jim Monaghan, announced the bill’s introduction of the SALT Marriage Penalty Elimination Act that, if enacted, would remove a penalty imposed on married individuals in the current tax code, doubling the cap for joint filers. The bipartisan legislation is co-sponsored by Rep. Sherrill and Rep. Anthony D’Esposito (R-NY-4).
“Hudson Valley families suffer under some of the highest taxes in the nation,” said Rep. Lawler. “The misguided SALT tax cap has only added to their pain in recent years. That’s why I’m proud to introduce the SALT Marriage Penalty Elimination Act.”
He added, “This bill will double the cap for married couples filing jointly to $20,000. It’s the first in a series of bills, which I’m calling the Hudson Valley Affordability Pact, that will tackle cost-of-living and affordability issues in the 17th Congressional District and beyond.”
Rep. Lawler noted that combined with his recent bill the “Anti-Congestion Tax,” aimed at eliminating the MTA’s proposed congestion pricing plan, the legislation is geared to “providing real relief to Hudson Valley families and commuters. While I am committed to fully repealing the SALT Cap, this is a measure we can enact this year as we work towards that larger goal.”
In 2022 there was a push by some area federal legislators, including members of the SALT Caucus, to repeal the SALT Cap. However, in late budget negotiations, after fighting to repeal the $10,000 limit on the federal deduction for state and local taxes, the House approved the budget reconciliation without SALT reform.
The SALT Cap was enacted as part of the Republicans’ tax overhaul in 2017 and instituted a $10,000 cap in state and local taxes on their federal tax returns, which many lawmakers say target high-cost states such as New York, Connecticut and California.
Since its enactment, legislative and legal measures to either reform, abolish or sidestep the SALT Cap have been unsuccessful.