Editorials & Other Articles

Yo_Mama_Been_Loggin

(126,060 posts) Mon Jul 7, 2025, 08:11 PM Jul 7

Who stands to benefit from the new SALT cap? High-earning homeowners in high-tax states.

Thanks to the new $40,000 cap on deducting state and local taxes, some homeowners may want to start itemizing again.

President Trump’s massive new tax bill has a number of changes affecting homeowners. High earners who live in high-tax states are likely to get the biggest breaks.

The reason? The new law bumps the cap on state and local tax deductions from $10,000 to $40,000. A boosted SALT cap will make it more advantageous for many homeowners — especially those living in high-tax states like New York, New Jersey, and California — to start itemizing their taxes once again. The change could translate to thousands of dollars in annual tax savings for those homeowners, financial planners and tax professionals told Yahoo Finance.

High earners, especially those who own expensive homes and pay hefty property taxes, can easily end up paying more than $10,000 in state and local taxes in some parts of the country. According to Realtor.com calculations, 40% of homes in New Jersey are taxed at over $10,000 a year, followed by 26% in New York and 19% in Connecticut and California.

https://finance.yahoo.com/news/who-stands-to-benefit-from-the-new-salt-cap-high-earning-homeowners-in-high-tax-states-204904190.html

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Who stands to benefit from the new SALT cap? High-earning homeowners in high-tax states. (Original Post) Yo_Mama_Been_Loggin Jul 7 OP

It hits Virginia too Varaddem Jul 7 #1

This message was self-deleted by its author Varaddem Jul 7 #2

Another tax break for the wealthy MichMan Jul 7 #3

This doesn't help only the rich. DFW Jul 8 #4

Varaddem

(437 posts)

1. It hits Virginia too

Reply to Yo_Mama_Been_Loggin (Original post)

Mon Jul 7, 2025, 08:17 PM

Jul 7

A Congress person home in Northern Virginia is well over $1 million. When I saw it, I knew who they were taken care of.

Response to Yo_Mama_Been_Loggin (Original post)

Varaddem This message was self-deleted by its author.

MichMan

(15,491 posts)

3. Another tax break for the wealthy

Reply to Yo_Mama_Been_Loggin (Original post)

Mon Jul 7, 2025, 09:31 PM

Jul 7

DFW

(58,503 posts)

4. This doesn't help only the rich.

Reply to Yo_Mama_Been_Loggin (Original post)

Tue Jul 8, 2025, 03:17 AM

Jul 8

My sister moved to rural New Jersey several decades ago. She and her husband bought a small, modest house for $175,000 and got by. Then came the Cheneybush real estate bubble, and their property tax shot through the roof when the assessed value of their house tripled while their income remained static.

Then came the $10,000 deduction cap, and they were forced to dip into savings just to stay afloat after paying the new huge property tax. They are over 60 and work in entertainment, which is sporadic income at their age.

They get by, but also in part because I shared my windfall part of our inheritance with my two siblings that later rose to be worth more (six figures!) than it was at the time it was divided up. The parts that they kept turned out not to contain anything that rose in value like that. But the tripling of the assessed value of their house meant no additional riches for them, no jump in their income, just an immense increase in their property tax. The deduction cap really put the screws to them. They are not deserving of the “tax the rich” scorn being globally applied in some quarters. Despite what the New Jersey tax assessors may declare, they are not rich, just taxed.

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