and do not recycle it!

What can be accomplished by legislation can be undone with legislation.

They merely passed a superceding act. I doubt it will be given a hearing.

Now if it were a constitutional clause, then thd wheels would come off.

Maybe im wrong on this. But they can literally rewrite. Any legislation a prsvious congress passed.

It how its supposed to work.....

From the very conservative American Enterprise Institute:

"The SALT deduction, which dates all the way back to the introduction of the federal income tax, is a lynchpin of the federalist system. Just like the charitable deduction expresses our preference, as a society, for civil-society solutions over solutions implemented in the shadow of the government’s monopoly on violence, the SALT deduction expresses our preference for local solutions to local problems."

From Progressive pundit John Stoehr:

Missing in the debate over the elimination of state and local taxes in the Senate tax bill is whether it's constitutional.

It might not be.

There's something it would be, however: a violation of the states' rights the Republicans say they alone represent.

For one thing, the bill "federalizes" revenue that would have remained in states under the current system. If the SALT provision survives reconciliation between House and Senate versions, it would extract wealth from the 43 states that levy income taxes to fund tax cuts for corporations and the rich.

Funny how the post never says.

It limits the state and local tax deduction to a certain amount. If doing so "punishes" taxpayers (from any state) who pay more in state and local taxes than can be deducted then the longstanding limits on other deductions (some of which still applicable) also "punish" individuals. For example, medical expenses are only deductible to the extent those expenses exceed 10 percent of the taxpayer's adjusted gross income. A taxpayer who has 50,000 in income and 10,000 in medical expenses can deduct 5,000. Another taxpayer who also has $10,000 in medical expenses, but $100,000 in income can't deduct anything.

The tax code has long drawn all sorts of distinctions. Farm income is subject to different rules than income from other sources. That "benefits" states with a lot of farming, but it is neutral -- it doesn't matter what your politics are or if you live in a "non-farm" state but happen to be a farmer.

"The Bill of Rights prescribes that “the powers not delegated to the United States by the Constitution, nor prohibited by it to the states, are reserved to the states.”

Scholars and judges differ over where state control ends and federal oversight starts. But NO scholar argues that states, cities and towns don’t possess the right and obligation to staff schools, pave roads, purify water and put out fires.

For this, local and state governments need money — which they mostly get from their own taxpayers, not from Washington. To assert that the federal government has the primary claim on this tax dollar, as Republicans are doing, is to claim that the federal government bears the primary responsibility for these tasks."

For example: Education is not delegated to the Federal Gov't by the constitution and, as such, that power is reserved for each state to decide for themselves. The loss of revenue due to SALT limitations infringes on a states "right and obligation" to provide the education it deems adequate and necessary.

""the essence of the federal idea is that there are arenas of government that must not be invaded by other governments."

It doesn't change state tax rates, it simply makes the amount paid to the state non-deductible from federal taxes above a certain threshold. The amount of federal tax paid increases. The amount of state tax paid is unchanged.

It denies states their powers as outlined in our federalist system and clearly stated in the constitution.

It makes it more difficult for the state to increase SALT. States will have to consider the affects and opposition to an increase in SALT taxes. A 3% increase will mean more than a 3% loss to some taxpayers. NY and CA are considering this as part of a potential challenge to the law.

Again, there is no constitutional requirement that there be any deduction for state and local taxes. If it was done away completely tomorrow, it also would, following your logic, make it harder for states to raise their taxes because the actual cost to a taxpayer would be higher than it would be if they could deduct those taxes. And the impact of setting a limitation rather than eliminating it completely falls on taxpayers in every state.

Finally, most taxpayers don't itemize so the limitation on the SALT deduction is unlikely to be a game changer in the political calculus over raising state and local taxes. And there are "red" states where more people itemize (Utah, 35.4%, Georgia 33%) than in some "blue" states (Vermont, 27.3%, Hawaii 29.2%).

(not that it's all that good an argument,but that's a subject for greater minds than mine.....)

John Marshall, McCulloch v. Maryland: "...the power to tax is the power to destroy."

No because the Constitution requires it to be:

South Carolina v. Baker, US Supreme Court (1988): "The owners of state bonds have no constitutional entitlement not to pay taxes on income they earn from the bonds."


By the way, interest on muni bonds issued by one state typically are only exempt from state tax in the issuing state, not in other states. And there are a few states that tax interest on bonds that they issue.

Having trouble finding exactly where this argument is coming from. A taxpayer group would need to bring the case, DOJ would, I guess defend, and I'd expect it would go to SCOTUS. But I don't have time to research. I hope that @krassenstein gives us the basis for this.

Let the smart brains out there go for broke tonight!

Find us an answer out of this damned illegal mess!

ALBANY — Gov. Andrew Cuomo said Thursday that the just-passed federal tax overhaul could be unconstitutional because it disproportionately affects Democrats and that he is considering a lawsuit.

Cuomo, a Democrat, told Katy Tur on MSNBC that the $1.5 trillion tax bill punishes high-tax, Democratic states like New York, California and New Jersey by curtailing the ability to deduct state and local property taxes.

The tax bill capped those deductions at $10,000. Property taxes alone often exceed that threshold, particularly in some downstate areas. The effect will be to increase taxes on some residents, although other provisions of the tax bill — like lowering marginal rates — could offset that.

“It would be like me passing a state law saying, ‘Republicans pay one tax rate — a higher tax rate — and the Democrats pass a lower tax rate.’ That’s what they did on a nationwide basis,” Cuomo said. “We’re exploring ... to see if there is a legal challenge. I think it may very well violate the due process and equal protection laws. It is the most egregious political act I have seen — not since the Civil War have you seen the states this divided.”

https://www.politico.com/states/new-york/albany/story/2017/12/28/cuomo-tax-bill-unconstitutional-because-it-punishes-democrats-163770

It’s a seed for the start of secession.

Unfair taxation is what broke us away from the British empire.

If allowed to continue, the rumblings will start.

I refer to the above statement by Gov. Cuomo on the division between the states.

At least no one grounded in reality.

reality is not what it once was.

Hmmm...maybe he’ll lower the states taxes to help out!

run against the high state taxes and have a chance to change them Red. The Republicans help
influence state elections with this tax law.

It "punishes" everyone in high tax states -- Democrats,republicans, independents, libertarians, politically apathetic people. It's not as if everyone in these states are Democrats.

And it impacts some states that have more republicans than Democrats more than it impacts some other states with more Democrats than republicans.

Here is a list of the top 10 property tax states:

New Jersey 2.38%
Illinois 2.32%
New Hampshire 2.15%
Connecticut 1.98%
Wisconsin 1.96%
Texas 1.90%
Nebraska 1.84%
Michigan 1.78%
Vermont 1.71%
Rhode Island 1.67%

taxing some states less favorably than others unconstitutional. If someone lives in West Virginia they can claim all their state
taxes. But if you live in California you can't. That doesn't sound like equal treatment under the law.

The previous version of the law also taxed people in different states differently because different states have different tax rates. The value of the the SALT deduction was greater for people in high tax states than in low tax states.

In addition, the AMT wipes out the SALT deduction, which means the AMT provisions hit people in high tax states harder than in low tax states.

A lawsuit challenging the tax law on constitutional grounds has zero chance of success.

before? What this is going to do is make people in the higher taxed states demand
a tax cut to make up the difference. As usual in steps the Republicans promising tax cuts.
Like when Ronald Reagan was elected in California. The race to the bottom, next thing you
know California will be like Mississippi. Like one poster said it is gerrymandering by the tax code.

Yes, more people would be affected in CA than WV but some in WV would be affected also.

It's not based on where you live, it's based on the amount of state and local taxes you pay. There will be people (Democrats and Republicans and everything else) who pay more than the threshold even if they live in a low tax state and there will be people who live in high tax states who have a total SALT bill that is less than the threshold.

It's not so cut-and-dried. That's property tax as a percentage of home value, but if you live in an area where property values are high, you can be paying more property tax even if a lower percentage. For example, New York is not on that list, but the average property tax in NY is about 80% higher than in Texas ($4,600 vs under $2,600), because the houses are more than twice as expensive (median home value is $283k in NY vs.$136k in TX).

as intended. If it's not illegal, it should be.

it punishes them as well.

It doesn't single out Democratic taxpayers, it singles out (in effect) high tax states. There are states that have more republicans than Democrats that have higher tax rates than some states that have more Democrats than republicans. And every state has both republicans and Democrats.

New Jersey was high tax and partly controlled by Republicans up until last year. Even NY has had two branches controlled by Republicans for long stretches of time. So I’m not sure this argument is going anywhere.

If indeed the tax cut is illegal because it affects more Democrats, that would also means any tax increases on the wealthy are also illegal as that would affect more Republicans.

New York has a progressive income tax. Wouldn't that be illegal by Cuomo's own statements since Republicans more likely are paying a higher tax rate than Democrats?

“It would be like me passing a state law saying, ‘Republicans pay one tax rate — a higher tax rate — and the Democrats pass a lower tax rate.’ That’s what they did on a nationwide basis,” Cuomo said.

health care and who refused to enact medicaid reform being fined...courts said no states can 't be punished...and this could very well happen with the tax bill Cuomo is correct and should work on all options available. The sanctuary city ruling against Trump based on the same premise.

...a Federal Law can be superseded by a new Federal Law.

Otherwise it remains on the books creating a conflict.

If there is a conflict the latest law supersedes any previous law.

The express repeal -- specifying the specific old law or portion thereof that's affected, and stating "is hereby repealed" -- is what careful legislative drafters do.

This latest tax bill was, shall we say, not exactly a model of what careful legislative drafters do.

There's also repeal by implication, when the new law is plainly inconsistent with the old law. The tax bill, although particularly egregious, isn't the first law that could have used a little cleaning up. Previous laws have been held to impliedly repeal some other law.

There's a doctrine that repeals by implication are disfavored. That means that, if the two statutes can reasonably be construed in such a way that they're harmonious, courts will tend to adopt that interpretation.

But "disfavored" doesn't mean "impossible". If the two statutes are clearly inconsistent, then one applicable rule of construction is that the more recent statute is given effect. The conclusion (perfectly reasonable, IMO) is that the legislature presumably intended to exercise its power to repeal the earlier statute.

If a 1913 law says that state and local taxes are fully deductible, and a 2017 law limits the deduction to $10,000, then the inconsistency is obvious. The conflict would be resolved in favor of the more recent law.

...which came into existence as part of the Constitutional Amendment in 1913. It amended it.

Any conflict between the language in an original statute and that of an amendment to that statute is resolved in favor of the amendment.

My income is reduced by payroll and income taxes.

My income is less the deducted taxes from my employer.

let's say that my state taxes were 100% of my income, would I still owe the Feds? Where would I get the money?

Your take-home pay is not the same thing as your income.

It seems that this issue (Eliminating SALT Deductions) during the debate of the Reagan tax cuts was shot down by Daniel Patrick Moynihan. Here is an excerpt from the linked article:

<snip>Another principle Moynihan discussed was the issue of “double taxation.” Interestingly, an aversion to “double taxation” is frequently cited by Republicans and conservatives to justify reducing or eliminating taxes on dividends — dividends already are taxed once as corporate income, so why should they be taxed again when they’re received by shareholders.

But eliminating the SALT deduction would be a more far-reaching example of double taxation, Moynihan said, citing a resolution by the National League of Cities calling the deduction “a fundamental statement of the historical right of state and local governments to raise revenues and of individuals not to be double taxed.” As it happens, the Supreme Court has spoken on the issue of double-taxation: It’s wrong. In a 2015 decision written by Justice Samuel Alito, the court ruled that a Maryland provision denying its taxpayers credit for taxes paid to other states was unconstitutional. Expect the states’ challenges to the GOP tax bill to cite that ruling (Comptroller vs. Wynne) prominently.<snip>

http://www.latimes.com/business/hiltzik/la-fi-hiltzik-salt-deduction-20171208-story.html

Gasoline taxes, sales taxes and others are assessed daily on people's income that has already been taxed.

As a very simple example... anyone taking the standard deduction (roughly 70 percent of filers) doesn't get to deduct their state or local taxes already.

Note that the "double taxation" point by Moynihan was merely an attempt to get Republicans on board with him since they had been whining about the double taxation from corporate dividends for years (as well as estate taxes). It isn't going to be persuasive on DU.

...it doesn't mean that you can't itemize, if you want to.

You're really picking at straws here. Double taxation isn't illegal, let alone unconstitutional. Nor did the ruling cited earlier (by Alito) say so (despite what Hiltzik described it as). That case involved two states taxing the same income.

We'll see.

Two countries can tax the same income, but usually enter into treaties to avoid it (as with the OECD model convention that EU members adopt). The SCOTUS ruling was essentially that US states were de-facto in such a system by being part of the same country since it would hamper interstate commerce (violating the commerce clause of the Constitution).

But nothing in the ruling impacts states and the feds taxing the same income (in some areas, the county/city taxes income as well).

If, for instance, you lived in Detroit but had substantial income from across the river in Canada, you might pay income taxes to both countries (with a credit from one for taxes paid to the other), the state, and income tax to Detroit.

Also note... there are over 40 states with their own income tax. Only a handful of them allow you to deduct your federal income taxes paid from your taxable income for state tax purposes (and in all but three cases it's just the first few thousand). Cuomo's New York is not one of them.

therefore, have no standing.

Taxes can be applied at each level of government... which was that two countries CAN each tax income, they just usually don't. Two other governments at the same level (state-state or local-local) can't do so IF the level above them disallows it. The US doesn't allow two states to each tax the same income and (presumably) states that allow local taxes won't allow two cities/counties to both tax the same income... but the only thing keeping the fed and state governments from both taxing the same income was the 1869 law - which is now trumped by the more recent law.

We can say that it's bad policy... but we can't say that it's illegal based either on the 1860 law or the cited SCOTUS ruling. Similarly, the ruling could call in to question other states that tax income that another state already taxes (as with New York's "telecommuter tax&quot ... but would have nothing to do with Fed/State both taxing the same income.

I further point out that Ginsburg's dissenting opinion reminded the court of their prior rulings (Indeed, the Court’s decisions have long acknowledged that “Today’s decision veers from a principle of interstate and international taxation repeatedly acknowledged by this Court: A nation or State “may tax all the income of its residents, even income earned outside the taxing jurisdiction.” Oklahoma Tax Comm’n v. Chickasaw Nation, 515 U. S. 450 –463 (1995).

The majority disagreed that this power wasn't sufficient to overcome the commerce clause, but did agree that (absent that) governments do have that power.

... while simultaneously missing that there’s no chance that Alito would vote to nullify a republican tax cut.

Thanks for the entertainment.

but not all.

The SALT deductions are mostly for the rich in Blue States. Conservatives like the rich, wherever they live. That money, from the rich in blue states funds our state government. it's not all so cut and dried.

Remember when Roberts saved Obamacare?

I just noticed the thread and thought “50 Posts and nobody on DU has realized that it’s nonsense?”

Had to read halfway down the thread to find posts 4&5.

Earlier law is often replaced by subsequent law, especially when it comes to tax law.

Rates and deductions and such have often changed.

It’s not illegal just because it was once different.

Justice Alito wrote the majority opinion.

WASHINGTON (Reuters) - Maryland cannot impose double taxation on residents by denying them a full credit for certain taxes paid on income earned in other states, the U.S. Supreme Court ruled on Monday in a decision that could cut revenue collected by some states and cities.

https://www.reuters.com/article/us-usa-court-tax/u-s-top-court-rules-against-maryland-over-double-taxation-idUSKBN0O31G620150518

Let's see what kind of lie the GOP will concoct to weasel their way out of this f'ck-up?!

Lets hope Cuomo gets something DONE!

Double taxation w/o representation = rich man's wet dream!

You just don't have control. For now.

The ACA affected a lot of (R) who didn't have control. Presumably they didn't have representation? Not the way it works.


Think about this: You're taxed on your income, right? So let's say you've managed to put aside $10k, one way or another.

Let's say you've stuffed in under a mattress. You pay no taxes on it.

Let's say you've invested it in gold. You pay no taxes on it.

Let's say you've invested it in Google stock. You pay no taxes on it--but if you sell it you get to deduct a capital loss or pay tax on any capital gains.

Now let's say you've bought a bit of land. You do pay taxes on it. Not on capital gains. No, you pay taxes on it for the benefit of being able to say, "I have $10k in land."

It's not double taxation. It's continual, on-going taxation. I've paid taxes here for 8 years. Fortunately, as the amount of $ I put into the mortgage goes up, the effective tax rate per dollar invested goes down.

But that's okay, because that's the way it's worked for a long, long time.

Apparently not.

I learned this lesson early in my career when I went into a Senator's office and argued that what they were proposing arguably would conflict with an existing provision of law -- the answer, succinctly put was "then our law will change that existing provision".

The first sign that a poster is not a lawyer is when they use the term "precedence" instead of "precedent".

U.S. top court rules against Maryland over double taxation

WASHINGTON (Reuters) - Maryland cannot impose double taxation on residents by denying them a full credit for certain taxes paid on income earned in other states, the U.S. Supreme Court ruled on Monday in a decision that could cut revenue collected by some states and cities.

In a 5-4 ruling, the justices sided with taxpayers Brian and Karen Wynne in finding that Maryland’s taxation policy violated the U.S. Constitution by discriminating against interstate commerce, upholding lower-court decisions favoring the couple.

https://www.reuters.com/article/us-usa-court-tax/u-s-top-court-rules-against-maryland-over-double-taxation-idUSKBN0O31G620150518

The case is over an entirely different issue. Even if it were not, it’s pretty clear that the state of Maryland cannot overturn federal law… But the US Congress can.

Doesn't the new law override the 1913 one?

they have two tax tables where people in California and other Blue states making $20000 would be taxed 15% and people living in
a Red state like West Virginia would be taxed 5%. How is this any different?

The law doesn't say residents of one state pay a higher tax rate than residents of another state. It says taxpayers who pay more than a threshold level of state and local taxes can't deduct above that threshold, no matter where you live. There are people in every state that will not reach the threshold and people in every state that will exceed the threshold. Yes, how quickly one reaches that threshold is going to be impacted by the state tax rate one pays, but that was true under the AMT system where, at some point, taxpayers were denied any SALT deduction.

Not in every instance, but in aggregate partisan

as much as I hate the new tax law, it definatey overrides any previous tax related laws. Unless it is proven to be unconstitutional (likely impossible with current SC), we are stuck with this.

"In 1910 you didn't need a driver's license to travel the roads, so you don't need one now."

You know that great big building with a dome on the roof that's on First Street in Washington, DC? It's full of people whose whole job is to make shiny new laws, and some of them repeal old laws. That's what's been done with the tax scam.

The No Taxes and No Jobs Act of 2017 is a vast number of things - all of them bad - but "illegal" is not one of them.

He knows that, whether or not a lawsuit succeeds, or even has any reasonable chance, it will be popular. It will help his 2018 re-election bid because he'll tell New Yorkers he tried to reduce their tax burden. It will help his campaign for the 2020 nomination for President because he'll tell Democrats he boldly stood up to Trump.

Since more wealthy taxpayers are Republicans, doesn't the mere existence of progressive income taxes also punish a class of voters ?

Meaning that the unlimited deductions (within the confines of the AMT) means high-wealth/high-property-value states' citizens benefit to a greater extent.

That's the flip side of the complaint. The cap hits certain states harder; it means they profit from that provision more than others.

Note that the AMT also hits some states harder than others.

At least not a successful challenge.

It doesn't target "liberal" states. There are "liberal" states with lower tax rates than some conservative states and "conservative" states with higher tax rates than some liberal states.

It doesn't matter where you live or what your political affiliation, if any, is or what party the state's current governor is or which party controls one or even both of the state houses -- it applies to voters without regard to their politics. A conservative republican who exceeds the threshold has their deduction capped. A liberal Democrat who doesn't exceed the threshold doesn't.

Buffalo has huge taxes on moderately priced houses and Republicans live in them...with Republican house representatives but maybe not after 18.

Because I hear all kinds of intents attributed to all kinds of people and often the people with those intents knew nothing about it.

and whose property is valuable enough that their state and local taxes exceed the $10K threshold, no matter where they live. There is no uniform "liberal state" tax rate. The amount of income that crosses the threshold in one "liberal state" may not cross it in another. And there will be some taxpayers in every state with enough taxable taxable income or property that it doesn't matter where they live -- the limitation would kick in.

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