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> New York recently began allowing taxpayers to convert local property taxes into charitable contributions, which are fully deductible from federal taxes. Other
by koolba 8y ago
> New York recently began allowing taxpayers to convert local property taxes into charitable contributions, which are fully deductible from federal taxes. Other states, like New Jersey and Connecticut, have been moving forward with similar plans to reclassify state taxes as charitable contributions.
If they consider their taxes a charitable contribution I should be able to decide to not pay it.
I know a lot of charities I’d rather give money to then the government.
- tango24 8y agoWait, property and state taxes are already deductible on federal 1040, right? So why are the states even doing this? The article is paywalled so surely I’m missing some info here.
- DennisP 8y agoFrom the article: > The I.R.S. warning comes in response to states, like New York, that have looked for ways to blunt the impact of a new $10,000 cap on the state and local tax deduction, known as SALT. The cap, which was included in last year’s $1.5 trillion Republican tax overhaul, hit predominantly Democratic, high-tax states hardest since it limits the amount of state and local sales, income and property taxes that residents can deduct from their federal taxes.
- asveikau 8y agoLast year's tax reform put a cap on that, which is highly inconvenient to people living in high tax, high income or high property value states like California, New York, etc.
- evanpw 8y agoThe deduction is capped at $10k starting in 2018.
- Spooky23 8y agoThe tax reform hit many places hard. You can only deduct the first $10,000. Every suburb of NYC has an average property tax of over $10k, plus most people pay state income tax. These people are doubly impacted by the higher standard deduction, which makes it difficult for all but the wealthy to deduct.
- lr4444lr 8y agoNot following your latter point: isn't the flat rate for the higher standard deduction progressive?
- Spooky23 8y agoNot really. It’s subsidizing sparsely populated states that either don’t need to or don’t care to provide the state/local services that populated places need.
- lr4444lr 8y agoWhat does population have anything to do with it? It's based on income. The fact that more densely populated places have higher per capita service costs is the problem.
- bcheung 8y agoNot sure I follow. The wealthier have higher incomes and higher property taxes due to buying more expensive homes. The $10,000 cap hits them even harder.
- deleted 8y ago[deleted]
- Spooky23 8y agoIf you live in New York, New Jersey, California, etc, a large percentage/majority of homeowners are impacted by the $10k cap. But you need to clear $24k in deductions (as a married couple) to even take that deduction. The average homeowner loses, as they can’t cross the threshold, and every marginal state/local tax dollar costs 15-25% more than it did before.
- bcheung 8y agoThe 2017 standard deduction for married couples was $12,700 (compared to $24K in 2018). So the average homeowner also gets an additional $11,300 tax free. Granted so do non-homeowners. I don't think the "average homeowner" would complain that they can't take as big of a homeowners deduction when the net result is they are exempting a larger portion of their income regardless.
- deleted 8y ago[deleted]
- JumpCrisscross 8y ago> If they consider their taxes a charitable contribution I should be able to decide to not pay it You still owe regular property taxes, with all the standard penalties for non-payments. What these laws do is give "municipal and county governments and school districts the legal authority to create special charitable accounts" and then let "local governments offer residents who contribute to the new accounts a nearly dollar-for-dollar property-tax credit, effectively turning their property tax bill, at least on paper, into a charitable contribution" [1]. Your contribution to the charitable account is voluntary. Your property-tax obligation is not. [1] http://www.njspotlight.com/stories/18/05/06/new-law-lets-local-governments-turn-property-taxes-into-charitable-contributions/ http://www.njspotlight.com/stories/18/05/06/new-law-lets-loc...
- lotsofpulp 8y agoI would be surprised to see a judge take kindly to that type of nonsense.
- deleted 8y ago[deleted]
- JumpCrisscross 8y ago> I would be surprised to see a judge take kindly to that type of nonsense We're a nation of laws. Not taking kindly to a case isn't justification for a ruling. The tax law was haphazardly drafted and written specifically to increase wealth transfers from surplus states (e.g. Delaware, Minnesota and New Jersey) to deficit states (e.g. New Mexico, Mississippi and West Virginia) [1]. I see valid arguments for both sides. [1] https://www.economist.com/graphic-detail/2011/08/01/the-red-and-the-black https://www.economist.com/graphic-detail/2011/08/01/the-red-...
- dahdum 8y agoThe SALT deduction was a handout to the most affluent and a subsidy to the wealthiest states. It allowed them to increase their state and local taxes at the expense of federal revenue, spreading that burden across the country. The tax plan certainly had flaws, but capping SALT was egalitarian IMO.
- mhneu 8y agohttps://www.yardbarker.com/nba/articles/bill_russell_once_lectured_charles_barkley_about_tax_complaints/s1_127_26113595 https://www.yardbarker.com/nba/articles/bill_russell_once_le... Charles Barkley: "Bill Russell called me one time… He says, “Charles Barkley.” I said, “Yes, sir, Mr. Russell.” “You grew up in Alabama. Right?” I said, “Yes, sir.” He says, “Did you go to public school?” I said, “Yes, sir.” He says, “Did the cops ever come to your neighborhood?” I said, “Yes sir.” He said, “Any of the houses ever on fire and the firemen come?” I said, “Yes, sir.” He said, “I don’t want to see your black ass on TV complaining about your taxes anymore.” I says, “What do you mean?” He says, “So now that you got money you don’t want to help other people out, but when you were poor, other people took care of you.” And I says, “You know what, Mr. Russell, you will never hear me complain about my taxes again.” And it was a very interesting lesson for me, because I do think rich people should pay more taxes. I’m blessed to be one of them, and we should pay more in taxes. I learned my lesson. I never complain about taxes. ---------- "I like to pay taxes. With them, I buy civilization" -- Oliver Wendell Holmes
- mindslight 8y agoI doubt those on the receiving end of the bombs share Holmes's sentiment.
- eschevarria 8y agoThat people who complain about taxes get some utility from the government activities funded by these taxes does not imply that they are better off with the combination of the services and the taxes than without. If this argument is meant to show that people should not complain about taxes, then it is invalid.
- anoncoward111 8y agoin another analogy, we should not praise the house robber for re-arranging our funiture after stealing our valuables
- RHSeeger 8y agoI don't have a problem with paying taxes. I have a problem with the government taking the money I pay in taxes and wasting it.