4 ms·

My gut take is that the removal of the SALT deduction had a huge impact in NJ due to the very high property taxes

lotsofpulp 5y ago
I doubt the vast majority of people (probably less than 10%) in NJ are paid enough to be affected by SALT since standard deduction went up so much. Property plus state income tax liabilities would have to be more than $12.5k/$25k single/married for people to have been affected. I would bet on school closings and the trend of higher taxes/less government services, but the latter is unavoidable due to the outlier amounts of debt NJ has.
- throwaway6734 5y ago
  >According to recent reporting, if we reinstated the SALT deduction, nearly a third of New Jersey residents — almost three million people — would get tax relief. As many as 80% of them have incomes of $216,000 or less. Hardly the 1%. https://www.northjersey.com/story/opinion/2021/05/17/salt-deduction-reinstatement-can-go-long-way-nj-ny-families/5093645001/ https://www.northjersey.com/story/opinion/2021/05/17/salt-de... NJ has very high property tax rates and high home values
  - lotsofpulp 5y ago
    The writer used the word “average”, but it would be clearer if they used median, or quintiles or deciles. I could not find a source for the report they claim to be saying 3 million people in NJ would benefit. NJ income tax is ~4%, and average property taxes are not that high: https://www.nj.com/politics/2020/03/njs-average-property-tax-bill-hit-8953-last-year-see-the-numbers-in-your-town.html https://www.nj.com/politics/2020/03/njs-average-property-tax... It would be nice to find statistics by percentile, but I would find it hard to believe that many single households are living in houses paying $8k+ property tax, and married households are paying $16k in property tax. I use $8k and $16k because that would mean the remaining $4k and $8k would be for income tax for a person earning $100k/year (78th percentile) or a couple earning $200k per year (83rd percentile). https://dqydj.com/income-percentile-by-state-calculator/ https://dqydj.com/income-percentile-by-state-calculator/ Edit: the best way to figure out if the SALT caps hurt or not is to see if the amount of people itemizing on federal returns increased or not. I cannot find any NJ specific statistics, but IRS says only 11% of tax filers itemized in 2019.

I doubt the vast majority of people (probably less than 10%) in NJ are paid enough to be affected by SALT since standard deduction went up so much. Property plus state income tax liabilities would have to be more than $12.5k/$25k single/married for people to have been affected. I would bet on school closings and the trend of higher taxes/less government services, but the latter is unavoidable due to the outlier amounts of debt NJ has.

throwaway6734 5y ago
>According to recent reporting, if we reinstated the SALT deduction, nearly a third of New Jersey residents — almost three million people — would get tax relief. As many as 80% of them have incomes of $216,000 or less. Hardly the 1%. https://www.northjersey.com/story/opinion/2021/05/17/salt-deduction-reinstatement-can-go-long-way-nj-ny-families/5093645001/ https://www.northjersey.com/story/opinion/2021/05/17/salt-de... NJ has very high property tax rates and high home values
- lotsofpulp 5y ago
  The writer used the word “average”, but it would be clearer if they used median, or quintiles or deciles. I could not find a source for the report they claim to be saying 3 million people in NJ would benefit. NJ income tax is ~4%, and average property taxes are not that high: https://www.nj.com/politics/2020/03/njs-average-property-tax-bill-hit-8953-last-year-see-the-numbers-in-your-town.html https://www.nj.com/politics/2020/03/njs-average-property-tax... It would be nice to find statistics by percentile, but I would find it hard to believe that many single households are living in houses paying $8k+ property tax, and married households are paying $16k in property tax. I use $8k and $16k because that would mean the remaining $4k and $8k would be for income tax for a person earning $100k/year (78th percentile) or a couple earning $200k per year (83rd percentile). https://dqydj.com/income-percentile-by-state-calculator/ https://dqydj.com/income-percentile-by-state-calculator/ Edit: the best way to figure out if the SALT caps hurt or not is to see if the amount of people itemizing on federal returns increased or not. I cannot find any NJ specific statistics, but IRS says only 11% of tax filers itemized in 2019.