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Democrats in High Tax States Plot To Blunt Impact of New Tax Law

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posted on Jan, 1 2018 @ 02:10 PM
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Since I live in Texas (no state income tax), I'm not really acutely aware of how the state income tax affects your overall Federal Income Tax. It turns out, though, that under the new tax laws, only $10,0000 of your state and local income tax is deducible from your Federal income tax. So property tax, school tax, and other taxes you pay will end up being things that you pay for but don't get a deduction for. This hits the upper middle class, of course and not the lower classes. It will hit hard in population dense states like Connecticut, with high housing costs and high tax rates.

The New York Times lays it out in pretty blunt detail People who have enough financial liquidity in New York have already paid their state income taxes (thanks to an executive order from Cuomo) so that it can be fully taken off the Federal income tax. And he's talking with other New York officials to see what can be done for next year.

As the article points out, corporations have been gaming tax laws for quite some time (we'd do better if we closed those loopholes.) Now governments are looking at redefining tax laws to give their residents tax relief from the new tax laws.

The article mentions several interesting tactics.




posted on Jan, 1 2018 @ 04:28 PM
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a reply to: Byrd

This is one tax change we should all get behind. First of all, it affects wealthier Americans and not the middle and lower class. Secondly, it encourages states to lower the state tax burden on their citizens.



posted on Jan, 1 2018 @ 05:00 PM
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originally posted by: Metallicus
a reply to: Byrd

This is one tax change we should all get behind. First of all, it affects wealthier Americans and not the middle and lower class. Secondly, it encourages states to lower the state tax burden on their citizens.


There you go using logic and reason.

If I was you I would insert the earplugs now and mix a stiff drink.
You know what's coming.



posted on Jan, 1 2018 @ 10:27 PM
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a reply to: Byrd

sounds like normal to me. always paid those STATEtaxes in SC. oh boo hoo.



posted on Jan, 1 2018 @ 10:35 PM
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a reply to: Byrd

Why get a break from the Federal Government because your state screws you? If $0 in state/local/property taxes could be deducted, so be it.

People criticize welfare ghetto queens, but get pissed off when the Feds cut back on their IRS welfare subsidies. Go figure.



posted on Jan, 1 2018 @ 11:55 PM
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originally posted by: carewemust
a reply to: Byrd

Why get a break from the Federal Government because your state screws you? If $0 in state/local/property taxes could be deducted, so be it.

People criticize welfare ghetto queens, but get pissed off when the Feds cut back on their IRS welfare subsidies. Go figure.



It actually has serious consequences. Most of the high employment states are also expensive places to live. Being able to deduct an unlimited amount of state taxes (not only income, but property and school and so forth) offsets the cost of living and makes the place more affordable. What they are worried about is that there will be a net weakening of the economic system.

State taxes are important... they pay for maintenance of interstate highways, for example, and roads between towns. They pay for national guard services (we used them during hurricanes here in Texas) and much more. They pay for state troopers on the highways and for state parks, public schools, correctional facilities, rehab facilities, etc. We came from an era where those weren't subsidized or provided by governments, and the abuses and costs were high... much higher than they are under government control.

Texas has experimented with private correctional facilities. They've been an expensive nightmare.



posted on Jan, 2 2018 @ 12:54 PM
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LOL If states really wanted to ease the tax burdens on citizens, they would reduce taxes and cut their spending. Anything else is simply playing the people.



posted on Jan, 2 2018 @ 01:25 PM
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a reply to: Metallicus

Doesn't it also ultimately give more power to the federal government? I mean if a state is taking in less money that's going to make them more beholden to federal funding.



posted on Jan, 2 2018 @ 02:59 PM
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The founders rejected income tax to finance federal government for good reason as its led to unchecked growth of nanny statism and intrusive meddling in people's lives.

Each state was intended as an experiment where the best systems of governence and economics would prevail and people could vote with their feet. Now it all skewed and corrupted by current system.

Reducing (better to eliminate) deductible state local taxes is a minor step in right direction.



posted on Jan, 2 2018 @ 03:01 PM
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originally posted by: Xcalibur254
a reply to: Metallicus

Doesn't it also ultimately give more power to the federal government? I mean if a state is taking in less money that's going to make them more beholden to federal funding.


How powerful would it be that states let their citizens hold on to their own money?



posted on Jan, 2 2018 @ 06:53 PM
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I don’t think it will hurt the rich democrats because they will get in back in the big tax cut for the rich. Just like republicans. It will hit the real middle class because they will just lose money. And republicans too. The great thing about all this, it’s the sole signature of republicans.



posted on Jan, 2 2018 @ 10:11 PM
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a reply to: Byrd

Well I don't pay that much in state taxes so it doesn't really affect me, but it will affect others. It's the blue states fault for implementing policies to siphon money from the feds.



posted on Jan, 3 2018 @ 05:40 AM
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a reply to: amfirst1

Lies. Idaho has been deep red for 30 yrs. We don’t have rich New York democrats. We have farmers with a thousand acres to pay taxes, including income tax.

I like this plan from the republicans. I’ve been waiting for 30 yrs for the religious nuts in Idaho to start voting for their wallet and not abortion.



posted on Jan, 3 2018 @ 06:29 AM
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In FL, where there's no state income tax, this was one section I never paid any attention to. I didn't pay any attention to it when we move to MI, either. I think the state tax is something like 4.-some-dd percent here. The 4 percent I'm sure of, the fraction I'm not. Regardless, I've never tried to recoup it via federal, it just doesn't cross my mind to do so. Maybe if it was higher than equating to a couple hundred in taxes a year, but meh, just doesn't seem worth the effort.



posted on Jan, 3 2018 @ 07:48 AM
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originally posted by: MOMof3
a reply to: amfirst1

Lies. Idaho has been deep red for 30 yrs. We don’t have rich New York democrats. We have farmers with a thousand acres to pay taxes, including income tax.

I like this plan from the republicans. I’ve been waiting for 30 yrs for the religious nuts in Idaho to start voting for their wallet and not abortion.


Fortunately, Idaho has an agricultural exemption for farmers to reduce their property tax burden if they own a lot of land and actively use it to produce. Many states have such programs.



posted on Jan, 3 2018 @ 09:02 AM
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a reply to: face23785

It’s a reduced market value rate, its still taxed.



posted on Jan, 3 2018 @ 09:32 AM
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originally posted by: Byrd

The New York Times lays it out in pretty blunt detail People who have enough financial liquidity in New York have already paid their state income taxes (thanks to an executive order from Cuomo) so that it can be fully taken off the Federal income tax. And he's talking with other New York officials to see what can be done for next year.



I live in New York.

The way I see it; Cuomo is doing exactly what he and other Democrats are complaining about the Trump tax plan. He is finding ways for wealthier New York's to pay less taxes and leaving the burden of the new tax plan to fall more on less wealthy New York's.

The cost of living in New York is high and on top of that property taxes are high and state taxes are high. The income needed here to put you in the middle class is higher than in other parts of the country. As such the wealthy AND middle class are negatively affected by the Trump tax cuts. Middle class New York's have a high enough income to pay the costs of living in New York; but only the wealthy and the established have the liquid assets to take advantage of Cuomo's solutions to the new tax burden. There for it is the middle class in New York who are hurt by Cuomo and Trump; you'd think they are working together for the same goal.

This of course is different from the overall argument of "Why are taxes in New York so high"; which does need to be explored and fixed. But in the immediate, Cuomo is helping the wealthy at the expense of the middle class in New York. Instead of addressing the overall high cost of living in New York he is giving disproptaionet relief to the wealthy and with out pressure on the wealthy the high cost problem will never get solved. He and his ilk are hypocrites, and this is yet another example of why I can not support the Democratic party.

Cuomo is helping to drive more and more middle class and young families out of New York which just erodes the future of New York.



posted on Jan, 3 2018 @ 09:38 AM
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a reply to: DanDanDat

Exactly. This tax giveaway trapped the middle class. There are no other loopholes for them. The rich democrats will recoup with a bigly tax cut.



posted on Jan, 4 2018 @ 09:22 AM
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originally posted by: MOMof3
a reply to: face23785

It’s a reduced market value rate, its still taxed.


That's why the key word in there is "reduce". I never said it eliminates their property tax bill. Virtually everyone else is paying property tax in the state, expecting them to pay none is unrealistic. But there are programs to help them out. As usual though, that's not good enough apparently. # it, let's just let everyone have anything they want for free.



posted on Jan, 4 2018 @ 09:26 AM
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a reply to: face23785

My original point was, this tax change will not just effect blue states.



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