So Trump has finally come around to our way of thinking.
More than a year ago we noted that Ted Cruz, Marco Rubio, Chris Christie, Jeb Bush, John Kasich and Ben Carson all had proposed repealing the IRS deduction for state and local taxes, but Trump was vague on the matter.
Nevada is one of only nine states with no state income tax to deduct.
On Wednesday Trump’s one page tax reform plan called for eliminating all deductions except for home mortgage interest and charitable contributions.
Predictably, the high tax states run by mostly Democrats are whining.
Nevadans — along with residents of New Hampshire, Florida, Wyoming, Texas, South Dakota and Alaska — get to deduct about 1 percent or less of our adjusted gross income, while those who live in New York, Maryland, D.C. and California deduct more than 5 percent. The federal government is effectively subsidizing the spending in those states at the cost the lower tax states.
Using 2010 statistical data from the IRS, you find Californians who filed for state and local income tax deductions claimed deductions of $10,700 per return. Nevadans who filed for the state and local sales tax deduction claimed only $1,430 per return.
Calculated on a per capita basis, Californians claimed $2,116 in federal income tax deductions, while Nevadans claimed only $166 per person for sales tax deductions.
Pro-state-and-local tax deduction groups were quoted as saying, “Any alterations to the deduction would upset the carefully balanced fiscal federalism that has existed since the permanent creation of the federal income tax over 100 years ago.”
It is long past time to upset this unfair tax break. Where do we go to get a rebate for being overtaxed?