SALT

[George K]

They told me if I voted for Donald Trump, the rich would get tax breaks, and they were right.

[jon-nyc]

Sweet. Hope it’s retroactive to 2021

[George K]

@jon-nyc said in SALT:

Sweet. Hope it’s retroactive to 2021

Somehow, I just knew you'd be first, LOL.

[jon-nyc]

My property taxes are creeping up to 40k, only 10k is deductible. If they let me deduct it all that’s a nice 10k boost on the margin.

[George K]

@jon-nyc said in SALT:

only 10k is deductible

Yeah, if you can exceed the standard deduction...

For us that's about $25K.

[jon-nyc]

We’ll the property tax alone exceeds the standard deduction. But I didn’t take that into account.

But I’d suddenly be able to deduct charitable contributions again, or rather it would make sense to. So my deductions would be ~50k ish rather than 24k ish. Net savings in the neighborhood of 10k still.

[George K]

@jon-nyc said in SALT:

deduct charitable contributions

Is there a cap for charitable contributions for 2021?

[jon-nyc]

Not really, it’s just that my only deduction I get is the 10k limit of my property tax. So unless I donate >14k in a year the it makes sense to take the standard deduction. I donate just under that typically. So when they were about to change the law in 2018 I made a (tax deductible) multi-year equivalent deduction to a donor-advised fund which I now use for donations. If they change the law I could start donating out of personal funds again and take the full deduction, since my property tax alone gets me above standard deduction territory.

[George K]

[Mik]

Yep. Met with my financial guy today to work on whether or not to do Roth conversions. Doesn't look like it will make much sense for us. But the charitable contribution deduction (QCD) against the RMD might help when we hit that in a few years.
.

[Jolly]

@jon-nyc said in SALT:

My property taxes are creeping up to 40k, only 10k is deductible. If they let me deduct it all that’s a nice 10k boost on the margin.

Dude, you're wiping your butt with twenties and lighting cigars with Benjamins. Don't sweat the small stuff...

[jon-nyc]

If I’m reading it right, the new provision being voted on today is an 80k deduction limit and it covers this year!

Yay!

[LuFins Dad]

Was the SALT part of the infrastructure package? Or is it part of the 1.75 Trillion Dollar Sweepstakes?

[jon-nyc]

The latter.

[LuFins Dad]

So it still has to get past the Senate.

[jon-nyc]

Yeah but they've been working on Manchin and Sinema through the process so I think the understanding is it'll get through.

[Klaus]

@jon-nyc said in SALT:

My property taxes are creeping up to 40k

I wouldn't be surprised if there are people in your area who live in a trailer park but drive a Porsche. I wonder what kinds of incentives are caused by such massive property taxes, as opposed to collecting the same money via income tax or VAT.

[Mik]

I do not believe you will find any trailer parks in Jon's neighborhood. Nor in the surrounding area.

[Jolly]

For miles.

[Mik]

But I do believe the GOP will be campaigning all over this one.

https://www.newsweek.com/congratulations-democrats-you-just-passed-massive-tax-cut-rich-opinion-1651262