Tuesday, July 17, 2018

Blue States Sue Trump Over New Cap on Tax Deductions


The Attorneys General in New York, Connecticut, Maryland and New Jersey this morning have filed a lawsuit against the Trump administration challenging the constitutionality of the new cap on federal deductions for state and local taxes in the 2017 tax overhaul, reports The Hill.

The states are asking the U.S. District Court for the Southern District of New York to invalidate the $10,000 cap on the federal tax deduction for state and local taxes, known as “SALT.”

The states argued that prior to the 2017 federal tax overhaul, Congress consistently allowed federal taxpayers who itemized their tax deductions to deduct, subject to certain incidental limitations, all of their state and local real and personal property taxes, and either state and local income taxes or sales taxes from their federal income tax returns, which often adds up to more than the $10,000 cap.

“The new cap effectively eviscerates the SALT deduction, overturning more than 150 years of precedent by drastically curtailing the deduction’s scope,” the states said in the complaint.

The states argue in the complaint the new cap is unconstitutional because it goes beyond settled limits on the federal government’s power to impose an income tax and deliberately harms certain states and their residents.

Heroic, I am always in favor of fewer taxes!

-RW  

6 comments:

  1. "The states argue in the complaint the new cap is unconstitutional because it goes beyond settled limits on the federal government’s power to impose an income tax and deliberately harms certain states and their residents."

    Oh, the sweet irony. These high-tax states suddenly believe that there are limits on a government's power to tax, and suddenly worry about deliberately harming specific residents through taxation? This is like the Crips claiming that the Bloods don't recognize the crime of murder.

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  2. F__K these whiners! They want the rest of America to subsidize their tax and spend stupidity. Instead of taking a hard look at what they can do to reduce the tax burden on their citizens, they have to go cry like bitches to the feds via a lawsuit. Pathetic!

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  3. If a Democratic administration had raised taxes on states that voted Republican, those very same Democratic politicians would be giving us an earful about blah blah reducing inequality blah blah paying our fair share blah blah blah. Come to think of it, that's already happened many a time; now the shoe is on the other foot. Politics is about кто кого, who's doing what to whom; nothing more.

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  4. I live in the Failed State of Connecticut, a very high tax state. I am getting hurt by the SALT cap, but I don't blame Trump or Congress. I blame the state and the municipalities for their ridiculously high taxes. I can't wait to get out of this hell hole. Everyone wants to leave Connecticut.

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  5. Wouldn’t it make more sense to reduce federal funding in high-tax states rather than capping SALT deductions?

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  6. ...more than 150 years of precedent...? 2018 less 1913 is less than 150.

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