SALT

State and local taxes (SALT) has been a controversial issue since Trump limited the deduction to $10,000. Most people do not reach that amount when they add up their state income tax and their property tax so this hurts wealthy people. The democrats were upset with Trump because they said this effects the blue states where most of the rich people live. In Biden's new program this SALT limit will be increased to $80,000 and this will give a tax break to upper income people. A couple living in MN with a family income of $500,000 would pay $45,000 in MN state income tax. If they owned a $500,000 dollar home their property tax would be $40,000 so under the propose change they could deduct almost all of this. If this new law is confirmed it will save this couple about $25,000 in federal income taxes.