WASHINGTON – Homeowners would get a choice between deducting property taxes or mortgage interest on their federal tax returns as Republicans discuss…
WASHINGTON – Homeowners would get a choice between deducting property taxes or mortgage interest on their federal tax returns as Republicans discuss modifications to the sweeping tax code overhaul proposed last month.
“I am confident that there will be an accommodation for SALT [state and local taxes] so it won’t be repealed,” Rep. Chris Collins (R-NY) told The Post.
One potential compromise would allow homeowners to choose between two popular tax deductions: local property taxes or mortgage interest.
Another option being considered is capping the amount homeowners can deduct for state and local taxes, Collins said.
“There will be a compromise that doesn’t penalize middle income taxpayers in high tax states,” said Collins, who said he’s received such assurances from Majority Leader Kevin McCarthy.
Under Trump’s tax plan, almost all deductions would be eliminated except for mortgage interest and charitable donations.
The White House believes that by doubling the standard deduction and lowering rates, taxpayers overall would pay less.
But elected officials from higher tax states have balked, believing their constituents would end up paying more to the IRS.
More than 3.2 million people in New York — or about 35 percent of the state’s tax filers — claim their state and local taxes as deductions on their federal returns.
Manhattan leads the way nationally with residents writing off an average of $24,898 on their federal returns in state and local taxes.
A compromise is likely needed to get enough Republicans from high-tax states to support tax reform legislation.
Already several New York Republicans – including Reps. Dan Donovan and Peter King – have said they can’t support the current plan.
