Last week, U.S. Senator George Helmy (D-NJ) introduced the Tax Relief for Middle Class Families Act of 2024, maintaining his commitment to support New Jersey’s middle-class families. The bill proposes an amendment to the Internal Revenue Code of 1986 to increase the limit on state and local tax (SALT) deductions. The amendment would raise the SALT deduction cap from $10,000 (or $5,000 for married individuals filing separately) to $100,000 (or double that for joint filers), which would take effect for tax years retroactive to January 1, 2024.
“Some of New Jersey’s most essential workers, including our teachers, nurses, firefighters, law enforcement officers, veterans, and public servants, are struggling to make ends meet due to the rising price of the cost of living over the past few years,” said Senator Helmy. “The Tax Relief for Middle Class Families Act will help ease the tax burdens of New Jersey homeowners and provide meaningful financial relief. I will continue to do what I can to support New Jersey families during my time in office.”
The bill was originally introduced in the House in January 2023 as the Tax Relief for Middle Class Families Act by Representatives Mikie Sherrill (NJ-11) and Mike Lawler (NY-17).
“Securing SALT relief for New Jersey families from Trump’s disastrous tax bill has been a top priority of mine since I first took office. That’s why as part of my Jersey STRONG Agenda – the first five bills I introduced in this Congress to address pressing challenges facing New Jersey families – I introduced the bipartisan Tax Relief for Middle Class Families Act, which will allow 99% of NJ-11 families to fully deduct their state and local taxes and make life more affordable across our state,” said Rep. Sherrill. “When Democrats had the House majority, I led successful efforts to pass SALT relief twice. I am grateful to Senator Helmy for advancing this important legislation in the Senate and bringing us one step closer to lifting this unfair double tax on New Jerseyans. I will continue to fight to get this bill across the finish line – because middle class New Jersey families should not be penalized for the investments we make in our communities, our infrastructure, and our best-in-the-nation public school system.”
The SALT deduction increase brought on by the Tax Relief for Middle Class Families Act of 2024 would provide meaningful tax relief to 99 percent of New Jersey’s middle-class families, allowing them to keep more of their income for essential needs. By increasing the deduction cap from $10,000 to $100,000, New Jersey residents, especially those with high tax burdens, would be able to deduct a much larger portion of their state and local taxes, reducing their federal tax liability.
“We strongly support eliminating the $10,000 cap on state and local tax deductions. This unjust cap was enacted in 2017 to fund tax breaks for the wealthy and corporations. Working families in New Jersey should not be subsidizing tax cuts for billionaires. We urge all members of Congress to support this proposal to help millions of American families,” said Sean Spiller, President, New Jersey Education Association.
“Raising the SALT cap would be a win for high cost states such as New Jersey and provide much needed relief for both homeowners and home buyers. We thank Senator Helmy for his leadership on this issue,” said Gloria Monks, President, 2024 NJ Realtors®.
“Our PFANJ fully supports Senator Helmy’s efforts to increase the SALT deduction cap. Firefighters in New Jersey face high living costs, and increasing this deduction would provide much-needed financial relief. Our first responders, who put their lives on the line every day, deserve to keep more of their hard-earned income, and this change would directly improve their quality of life. It’s a critical move to support those who dedicate themselves to protecting our communities,” said Matthew Caliente, President, Professional Firefighters Association of New Jersey.
“When President Trump took away the Salt Deduction he struck right at the wallets and pocketbooks of all New Jersey residents, including the more than 6,000 firefighters, EMTs, and dispatchers of the NJFMBA,” said Eddie Donnelly, President, New Jersey Firefighters Mutual Benevolent Association. “Rep. Mikie Sherrill has been fighting to right this wrong since her first days in office, and we are excited to see Senator George Helmy making it one his first priorities as well. Rep. Sherrill and Senator Helmy are showing exactly the kind of leadership we need in Washington, DC, and we stand with them in this battle.”
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New Jersey State Senator Linda Helmy recently proposed legislation that would increase the cap on State and Local Tax (SALT) deductions for New Jersey residents. The SALT deduction allows taxpayers to deduct state and local taxes from their federal tax returns, providing relief for those who live in high-tax states like New Jersey.
The current cap on SALT deductions was implemented as part of the Tax Cuts and Jobs Act of 2017, which limited the deduction to $10,000 per year for individuals and married couples filing jointly. This cap disproportionately affects residents of high-tax states like New Jersey, where property taxes and state income taxes can easily exceed $10,000 per year.
Senator Helmy’s proposed legislation would raise the cap on SALT deductions for New Jersey residents to $20,000 per year for individuals and $40,000 per year for married couples filing jointly. This would provide much-needed relief for middle-class families in New Jersey who are struggling to make ends meet due to the high cost of living in the state.
In a statement announcing the proposed legislation, Senator Helmy emphasized the importance of providing tax relief for New Jersey residents, particularly in light of the economic challenges brought on by the COVID-19 pandemic. She argued that raising the cap on SALT deductions would help alleviate the financial burden on middle-class families and stimulate economic growth in the state.
The proposed legislation has received support from various advocacy groups and lawmakers in New Jersey, who see it as a necessary step towards addressing the inequities in the federal tax code that disproportionately impact residents of high-tax states. However, some critics argue that raising the cap on SALT deductions would primarily benefit wealthier individuals and exacerbate income inequality.
Overall, Senator Helmy’s proposal to increase the cap on SALT deductions in New Jersey has sparked a debate about the fairness of the federal tax code and the need for tax relief for middle-class families in high-tax states. As the legislation moves forward, it will be interesting to see how lawmakers and stakeholders navigate these complex issues and work towards a solution that benefits all New Jersey residents.
