U.S. Rep. Lauren Underwood

Sean Casten

Two Illinois congressional representatives have introduced legislation to provide tax relief for families hurt by tax deductions being capped.

Democratic freshmen Sean Casten (D-6^th) and Lauren Underwood (D-14^th) said that limits to state and local tax deductions, known as SALT, passed in the federal Tax Cuts and Jobs Act, place a uniquely large and disproportionate burden on middle-class families in their districts.

They said their legislation would help affected taxpayers by increasing the SALT deduction cap, eliminating the “marriage penalty” and adding an inflationary adjustment.

“As families in the 14^th District file their taxes this year, many are getting horrible and unexpected news — they owe thousands more than they did last year because they can no longer deduct all of their state and local taxes, thanks to changes in the recently enacted Republican tax law,” Underwood said. “This is unacceptable. Our community does not deserve to be double-taxed. My legislation would alleviate this burden for middle-class families in our community.”

Their legislation, House Resolution 1757, would increase the current SALT deduction cap of $10,000 to $15,000. Prior to the Tax Cuts and Jobs Act, the SALT deduction was unlimited.

“Residents of the 6^th District are already filing tax returns and feeling the sting of the increased tax burden imposed on them through the work of my predecessor,” Casten said. “With this legislation, I’m seeking to lift that burden, raise the SALT cap and restore the longstanding concept underlying the SALT deduction that citizens shouldn’t have to pay twice.”

Nearly 2 million Illinois households claim the SALT deduction. Specifically the legislation would:

• Increase the current cap on SALT deductions from $10,000 to $15,000 for individual filers. It would allow taxpayers making up to $200,000 to deduct more than the average SALT amount.
• Eliminate the “marriage penalty” by allowing people who are married and filing jointly to double their deduction up to $30,000. It is estimated that would provide additional relief to 90 percent of filers who file joint tax returns.
• Adjust the cap for inflation so the value of the deduction does not decrease over time.

In a January letter, Casten and Underwood urged the Internal Revenue Service to address the disproportionate tax burden facing Illinois families due to changes in the state and local tax deduction as passed in the Tax Cuts and Jobs Act, and expressed concern that current efforts by the IRS are insufficient.