Bipartisan lawmakers relaunch caucus to lift cap on ‘SALT’ deductions

More than 30 House lawmakers from high-tax states are relaunching the SALT Caucus to loosen a $10,000 cap on the amount of state and local taxes that filers can deduct on their federal returns.

Members of both parties formed the caucus to combat the cap that passed as part of then-President Donald Trump’s tax overhaul of 2017. The fight continues in the new Congress.

“As Tax Day approaches, it marks another year of my constituents getting the short end of the stick because it’s another year that they’re not able to deduct the entirety of their state and local taxes,” said Rep. Andrew Garbarino, New York Republican who formed the caucus with fellow Republican Rep. Young Kim of California and Democratic Reps. Josh Gottheimer of New Jersey and Anna Eshoo of California.

Supporters of a cap on the SALT deduction say blue states should rein in their taxes instead of forcing the federal government to fund a giveaway to relatively high earners.

Red-state Republicans often make that argument, while some Democrats say they want to keep the cap because lifting it would look like a gift to the wealthy.

House Democrats pushed to lift the cap to $80,000 during negotiations over President Biden’s tax-and-climate agenda last year, but centrist Sen. Joe Manchin III, West Virginia Democrat, rejected the plan.

Lawmakers in the SALT Caucus say the cap hurts middle-class residents in communities that tax heavily to invest in public schools.

“I’ve heard the arguments from the far right and I’ve heard the arguments from the far left. But what they miss every time is that restoring the SALT deduction will lower taxes for millions of real, everyday, middle-class families who we represent. I literally hear about it every single time I’m out in Jersey,” Mr. Gottheimer said.