SALT-Cap Repeal Gains Momentum

Republicans have nearly universally said they wonít vote for Bidenís plan as constructed now.

Time for Compromise

That means House Speaker Nancy Pelosi is increasingly likely going to need to come up with a compromise with the SALT-deduction advocates to forge a path forward in her chamber for Bidenís signature legislation.

The state and local tax deduction is particularly valuable to residents of high-tax states, including New York, New Jersey and California, where high incomes and expensive property levies means that many residents have much more than $10,000 of state and local tax costs, and end up with deductions they can no longer claim.

However, the issue is particularly thorny for Democrats because raising or repealing the SALT cap would largely help relatively wealthy residents and would do little to help lower-income households that arenít likely to have more than $10,000 to write off or even to itemize on their tax filings.

More than half of the benefits would go to households earning more than $1 million a year, according to an estimate from the Joint Committee on Taxation. It would cost $88.7 billion to repeal the cap in 2021, an amount that could eat into Bidenís other priorities.

Caucuses are groups of lawmakers formed to to pursue common legislative objectives. The size and scope of the groups ó which number into the hundreds ó range from the large and influential Congressional Progressive Caucus to smaller, niche groups like the Congressional Bike Caucus.

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