State and Local Tax Deduction


September 13, 2018

I strongly support this amendment, and I emphatically oppose the Republican effort to permanently double tax Illinoisans and tens of millions of other Americans by permanently capping the State and Local Income Tax Deduction. 

According to recent IRS data, 31 percent of Illinoisans claimed the SALT deduction.  The SALT deduction gave an average benefit of about $12,524 per Illinois household for a total of $24.12 billion across the state.  Thus, the Republican bill would increase the taxes on over almost 2 million Illinoisans by hundreds of millions of dollars – 85% of whom are in the middle class.

In my Congressional District, over 102,000 households benefited from the SALT, the vast majority of whom earned less than $75,000.  It’s surprising to see members vote for a bill that harms so many of their constituents. In Oak Brook and Westmont, Illinois, 60 percent of the families used the SALT deduction in 2016 with the average deduction of over $30,500.  Indeed, the five counties in Illinois with the highest average SALT deduction value - Lake County, DuPage County, Cook County, Kane County, and McHenry County - are represented on this Committee. It’s not just Chicago-area Illinois families that are bumping up against the Republicans’ SALT limits, either. Plenty of down-state families will lose out too.  In Dunlap and part of Peoria represented by another Member of this Committee, over half of households claimed the SALT deduction for an average deduction of $15,642.

The Republican SALT limit will encourage businesses to leave Illinois and discourage businesses from locating in my wonderful home state.  Why would businesses choose to subject their employees to double taxation if given the choice?  Why would lawmakers support a policy that so intentionally hurts Illinois?

The SALT deduction is a bedrock part of the tax code since its inception because it recognizes that all levels of government need revenue to carry out critical services to help citizens.  The Republican bill increases taxes for hard-working Americans AND threatens public services. 

State and local governments need revenue to provide education services, hire police officers, fix roads, ensure clean water, and support hospitals.  This is why the National Governors Association, the National Association of Counties, the National League of Cities, the US Conference of Mayors as well as public employee organizations strongly support the SALT deduction.  The SALT deduction also keeps housing affordable.  This is why the National Association of Realtors supports the SALT deduction. 

We need to fix the tax code to help real people, not Washington special interests.  People in Chicago need real tax reform for real people.  We need to help families pay their rent, buy good health insurance, afford quality child care so they can work and send their kids to college. We should not raise the taxes of hardworking Americans and undermine local government to subsidize the special interests and target blue states like my own.