Introduced in 2017 as part of the Tax Cuts and Jobs Act, a $10,000 cap on the state and local taxes (SALT) deduction on federal tax returns was put in place as part of the Trump-era tax code overhaul.
Homeowners like Michael Lambert, who has called Southeast Queens home for over 50 years, argues the tax code was weaponized to wreak havoc on middle-class families like his.
Lambert, who formerly worked for the comptroller’s office, says his family’s tax returns gave them a modest return in the years before the cap. Now, he is paying a monthly tax bill.
“This is something that never happened before,” said Lambert.
Lambert, and other homeowners who have been negatively affected by the SALT cap joined congressmen Tom Suozzi and Gregory Meeks last week to denounce the cap, calling for it to be restored in the infrastructure and climate bill currently being negotiated by the Biden administration.
“It’s crushing residents here in Southeast Queens, throughout New York City and throughout New York State,” said Suozzi. “Congressman Meeks and I are working together to try and get the state and local tax deduction restored to a full reduction so that homeowners who have to pay property taxes and city and state income taxes can deduct those taxes from their federal tax returns.
“It doesn’t make sense to pay taxes on the taxes you’ve already paid,” he added.
Meeks said that one of the primary ways to build generational wealth is through real estate, similar to how Lambert’s Jamaican-born parents passed down the house he currently resides in.
Speaking bluntly, Meeks asserted that the tax code change was a punishment handed down by former President Donald Trump to Democratic-led states.
“What we have here in Southeastern Queens is many people who make their biggest investment that they’ve ever made in their lives into their homes,” said Meeks. “When we’re talking about Southeastern Queens and homeownership, we’re talking about people who are of color primarily closing the wealth gap.”
Meeks added the SALT cap de-incentivizes buying a home, which Lambert attested to, saying his recently married son is living at home due to the fact that they cannot afford to purchse in the neighborhood.
“We don’t want to run people out to go back to North Carolina or South Carolina or down to Florida,” said Meeks. “We need to create an environment so they stay here. They want to stay here, they don’t want to be pushed out. That’s what’s at stake here.”
Suozzi said New Yorkers would see $12 to $15 billion returned if the current SALT cap was repealed.
As part of the ongoing negotiations with the president’s Build Back Better agenda, Suozzi hopes to see the SALT cap changes in the final draft of the bill.
“It was a pretty diabolical plan that is actually hurting a lot of middle-class families,” said Lambert.