House Bill Raises SALT Tax Cap; Senate Still To Vote

HUDSON VALLEY, NY — Among the items passed by the House of Representatives Friday morning in the Build Back Better Act was an increase in the state and local tax (SALT) cap.

The $2 trillion bill, which passed 220-213, increased the cap from $10,000 to $80,000. That would increase the amount that taxpayers can deduct from their tax returns.

The legislation now has to go to the Senate for approval.

The cap was set at $10,000 in 2017 federal Tax Cuts and Jobs Act passed during the Trump administration. Previously, taxpayers could fully deduct state and local taxes.

It was estimated that the reduced cap cost New York homeowners $30 billion, or $2,600 per home.

Westchester County Executive George Latimer said the Trump/GOP tax plan intentionally targeted the SALT cap deduction at $10,000 and it hurt Westchester's taxpayers.

"Today, in a move that will lift up Westchester's hard-working middle class homeowners, the House of Representatives raised this cap as a part of the Build Back Better social infrastructure package," he said.

“Westchester’s middle-class homeowners chose to live here because of the exceptional services provided by local governments, schools and municipal entities," Latimer said. "Mass transit, educational opportunities, public safety officers and investments like our award-winning parks system all add to the high quality of life in our region."

Rep. Sean Patrick Maloney, D-Cold Spring, said it was long past time the country invested in America's families and future.

"I’m proud that the Build Back Better Act includes several issues I’ve championed on behalf of New Yorkers, including an expansion of the Child Tax Credit which will help bring 7,800 children in NY-18 out of poverty, tax relief for Hudson Valley families, who will once again be able to deduct extensive portions of their state and local taxes on their federal tax returns, and debt relief for Hudson Valley farmers," he said. "Critically, all this investment occurs in a fiscally-responsible way that will help our economy continue to grow by reducing inflation and the deficit in the long-term.”

Rep. Antonio Delgado called the passing of the act a "huge win" for upstate communities.

Through a spokesperson, he said, "This transformational legislation will make a real impact on New Yorker's lives, as it lowers prescription drug costs, significantly expands affordable health care, delivers universal pre-K, provides millions of middle-class families and workers a significant tax cut, and makes game-changing investments to bring down costs."