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https://www.yahoo.com/news/second-biggest-program-democrats-spending-202418744.html

The second-biggest program in the Democrats' spending plan gives billions to the rich

he House is expected to vote this week on President Joe Biden's Build Back Better legislation. The social spending bill includes investments in clean energy and affordable child care - but it also includes a $285 billion tax cut that would almost exclusively benefit high-income households over the next five years.

The measure would allow households to increase their deduction from state and local taxes from $10,000 to $80,000 through 2026, and then impose a new deduction cap through 2031. It's the second-most expensive item in the legislation over the next five years, more costly than establishing a paid family and medical leave program, and nearly twice as expensive as funding home-medical services for the elderly and disabled, according to an analysis by the Committee for a Responsible Federal Budget.

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The tax cut would partially reverse a tax hike from President Donald Trump's signature 2017 tax bill that was particularly burdensome to high-income, high-tax states. Before 2017, taxpayers could deduct virtually everything they paid in state and local taxes from their federal taxes, reducing the amount of income that the federal government could tax. The 2017 tax bill limited that deduction to $10,000 per year, creating what is known as the SALT cap.

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The SALT cap created in 2017 is due to expire in 2026, after which point there would be no limit on SALT deductions. The new SALT cap provision is revenue-neutral over 10 years because it imposes a new SALT cap after the original would have expired: $80,000 for four years, and then $10,000 in 2031.

Over the next five years, raising the SALT cap would provide a tax cut only to those who itemize their taxes and pay more than $10,000 in state and local taxes - a group overwhelmingly made up of the wealthy. A recent analysis from the Tax Policy Center says the tax cut will benefit primarily the top 10% of income earners, with almost nothing flowing to middle- and lower-income families.

"Anything you do to eliminate the SALT cap is going to be regressive, because that tax is overwhelmingly paid by very high-income people," said Howard Gleckman at the Tax Policy Center. "Anything you do to lower that tax doesn't matter for most people."

The rich are poised to gain more from the SALT cap increase than lower-income people are from other elements of the bill, such as the child tax credit. According to the CRFB, a household in D.C. making $1 million a year would benefit 10 times as much from the SALT cap as a middle-class household would from extending the increased child tax credit for one year, which would provide an extra $1,600 for children under 6 and an extra $1,000 for older children.

"We're debating about whether to give lower- and middle-class families a thousand dollars more a year through the child tax credit, while giving upper-class families $10,000 or more through SALT," said Marc Goldwein, senior policy director at the CRFB. "That's counter to everything the Democrats have been saying Build Back Better is about and everything they said about the Trump tax cuts."

Raising the SALT cap would more than offset other tax increases for the wealthy in 2022, according to a report from the Tax Foundation.

Proponents of the SALT cap provision in the Build Back Better Act argue that, over 10 years, the SALT provision would actually raise revenue. That's because the new, higher cap would last for nine years and then drop to $10,000 in 2031, while the current $10,000 cap is set to expire in 2025. The maneuver pays for four years of tax cuts by adding six years of higher taxes later.

The SALT provision wasn't in Biden's original social spending and infrastructure plans or in early versions of legislation in the House. Some form of SALT relief had been under discussion since the House first took up the reconciliation bill, said Garrett Watson, a senior policy analyst at the Tax Foundation. But the measure wasn't added until November, after negotiations that lowered the cost of the bill to woo centrist votes.

"This is a touchy issue and controversial issue even among folks on the center left," Watson said. "It was inserted late in the game, perhaps because of these competing desires to make the tax code more progressive, but also to provide tax relief to certain higher-income constituencies who, right or wrong, feel like they've been treated unfairly."

The provision was added at the urging of representatives from high-tax, high-income states like New Jersey and New York, which were hit particularly hard by the SALT cap.

Rep. Thomas Suozzi, D-N.Y., one of the measure's proponents, said the $10,000 SALT cap imposed in 2017 represented a sudden change in the tax code and imposed an undue burden on his constituents, pushing some high-income residents to leave the state.

"We've made decisions for 100 years based on the tax code," Suozzi said. "In 2017, the rug was pulled out from underneath us, and now it's less attractive to live in our states." He argued that in New York, a family earning $150,000 or $200,000 a year might still be considered middle class due to the state's higher cost of living, and would benefit from a higher SALT cap.

However, the Tax Policy Center reports that about 70% of the benefit of the bill would go to the top 5% of earners in the United States, those making $366,000 a year or more. That's because, according to Watson, many middle-income earners no longer use the SALT deduction at all. Other changes in the 2017 tax bill made itemized deductions less attractive to all but high-income Americans, pushing most other taxpayers to use a standard deduction that does not take state and local taxes into account.

If the Build Back Better Act passes the House with the higher SALT cap intact, it is unlikely to pass the Senate in its current form. However, some form of SALT cap relief is likely to be in the final bill, though it may be with a lower deduction limit or an income cap.

Senior Democratic leaders are also exploring tempering the impact of the increased SALT cap by raising the alternative minimum tax, which ensures that high-income households aren't able to avoid income taxes altogether through deductions like SALT.


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I am totally in favor of getting rid of the SALT Tax.

It has impacted me. Obviously I live in California.

10K is too low of a threshold for these states.


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Originally Posted by WooferDawg
I am totally in favor of getting rid of the SALT Tax.

It has impacted me. Obviously I live in California.

10K is too low of a threshold for these states.

I agree, but the prevalent thinking by many is everybody should net the same amount of money.


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It was a way for Trump to stick it to blue states....


There will be no playoffs. Can’t play with who we have out there and compounding it with garbage playcalling and worse execution. We don’t have good skill players on offense period. Browns 20 - Bears 17.

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The democrats decided to spend 1.9 trillion dollars of American money.

Democrat spending can't stop at 1.9 trillion dollars. Democrats thinking and mindset,
is of
bloodlust of greed in spending, other peoples money. as if the vaule of it didn't exist.
So, I'd ask a democrat. (I don't think they can give me a real answer If they seriously consider the question.)

1.9 trillion dollars.

Can any democrat, explain, why, it wasn't 1.9 QUAD-RILLION dollars?????

Now that would be, 1000 times more than it was. So the question becomes.

if the Democrats, can't spend 1.9 Quadrillion dollars, OR MORE, then they just don't CARE!!!!! (those selfish oldies)

Not by their thinking.

If spending money brings down costs, as their LIES say.
Then those heartless B*****..*-. didn't spend enough, not even 1/ 1000th enough.

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Originally Posted by WooferDawg
It was a way for Trump to stick it to blue states....


Now, thanks to the dems... it's a way to take from the poor and give to the rich.


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Yeah, all of that pre K pubic education gives to the rich and takes from the poor. Actually it's a huge help to working class families. Something you seem to have forgotten or ignored. I could go on with the many ways it helps the low wage and middle class workers but you've found a bone to chew on and won't let go. So for now I won't bother.


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Originally Posted by PitDAWG
Yeah, all of that pre K pubic education gives to the rich and takes from the poor. Actually it's a huge help to working class families. Something you seem to have forgotten or ignored. I could go on with the many ways it helps the low wage and middle class workers but you've found a bone to chew on and won't let go. So for now I won't bother.


Working class families cannot afford houses or taxes in these amounts.


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Originally Posted by superbowldogg
Originally Posted by WooferDawg
It was a way for Trump to stick it to blue states....


Now, thanks to the dems... it's a way to take from the poor and give to the rich.

If you were in favor of Trumps tax cuts, then you have no room to discuss this.


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Originally Posted by superbowldogg
Originally Posted by PitDAWG
Yeah, all of that pre K pubic education gives to the rich and takes from the poor. Actually it's a huge help to working class families. Something you seem to have forgotten or ignored. I could go on with the many ways it helps the low wage and middle class workers but you've found a bone to chew on and won't let go. So for now I won't bother.


Working class families cannot afford houses or taxes in these amounts.

Please show me where working class families will have their taxes raised. So are you trying to say this package will raise the cost of buying a house?

This is how much child care costs in 2021

More than half of families (57%) spent over $10,000 on child care in 2020, and 59% plan to spend more than $10,000 in 2021.

https://www.care.com/c/how-much-does-child-care-cost

Why are you so against the working class?


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The pre-k education scenario is a ruse.. The tax money goes into the general fund, and congress allocates the money. You could just as easily lament about how we should spend less on defense and more on pre-k.

It is not targeted money like the federal trust fund where a tax has an associated allocation.


There will be no playoffs. Can’t play with who we have out there and compounding it with garbage playcalling and worse execution. We don’t have good skill players on offense period. Browns 20 - Bears 17.

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Originally Posted by PitDAWG
Originally Posted by superbowldogg
Originally Posted by PitDAWG
Yeah, all of that pre K pubic education gives to the rich and takes from the poor. Actually it's a huge help to working class families. Something you seem to have forgotten or ignored. I could go on with the many ways it helps the low wage and middle class workers but you've found a bone to chew on and won't let go. So for now I won't bother.


Working class families cannot afford houses or taxes in these amounts.

Please show me where working class families will have their taxes raised. So are you trying to say this package will raise the cost of buying a house?

This is how much child care costs in 2021

More than half of families (57%) spent over $10,000 on child care in 2020, and 59% plan to spend more than $10,000 in 2021.

https://www.care.com/c/how-much-does-child-care-cost

Why are you so against the working class?


Just stop.

Working class families cannot afford 1,000+ a month just in taxes when their hhi is 5,000.

Also, these same people do not itemize their deductions. That would require about 1/2 of a "working class" person's annual income.

The salt tax change only helps the rich.

https://www.google.com/amp/s/www.vo...66735/salt-deduction-cap-democrats-biden


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Just stop. It also helps a lot of people in states with high state and local taxes.

What proposed SALT changes could mean for your next tax bill

https://www.vox.com/2021/11/6/22766735/salt-deduction-cap-democrats-biden


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Originally Posted by PitDAWG
Just stop. It also helps a lot of people in states with high state and local taxes.

What proposed SALT changes could mean for your next tax bill

https://www.vox.com/2021/11/6/22766735/salt-deduction-cap-democrats-biden


It really only helps the rich. Read the article.

Less than 16% of working class can claim more than the standard deduction and over 90% of tax filers of 200k used the deduction.


Tell me this is a tax break for the rich without telling me it's a tax break for the rich.


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So that would include some of the very same people I mentioned. Thanks.


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Originally Posted by PitDAWG
So that would include some of the very same people I mentioned. Thanks.


The 90%?


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First, what income do you consider "working class" that causes you to arrive at that 16% figure? There are nine states that have no state tax. Then there are states that have very low state taxes. So the fact is there aren't that many states that this tax cut will have any or very little impact on to begin with. That's a large part of why it will not impact more working class families.

What I will say is that it is pandering and catering to working class families that live in states with high state and local taxes which are mostly states Democrats control such as New York and California. That's what Republicans are actually upset about and I understand that.


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Originally Posted by PitDAWG
First, what income do you consider "working class" that causes you to arrive at that 16% figure? There are nine states that have no state tax. Then there are states that have very low state taxes. So the fact is there aren't that many states that this tax cut will have any or very little impact on to begin with. That's a large part of why it will not impact more working class families.

What I will say is that it is pandering and catering to working class families that live in states with high state and local taxes which are mostly states Democrats control such as New York and California. That's what Republicans are actually upset about and I understand that.


Did you read the article?

Vox describes it.


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I don't want you to misunderstand what I'm trying to say here. I don't disagree that the vast majority of this will help the wealthy. The point I am trying to make is that it will help a lot of people in states where their state and local taxes are high. By and large it goes against the message the Democrats have been sending. I hope that helps clear things up.


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