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H.R. 1142: SALT Act

The text of the bill below is as of Feb 11, 2019 (Introduced).


I

116th CONGRESS

1st Session

H. R. 1142

IN THE HOUSE OF REPRESENTATIVES

February 11, 2019

(for himself, Mr. Smith of New Jersey, Mr. Kim, Mr. Higgins of New York, Mr. Danny K. Davis of Illinois, Mr. Rouda, Mr. Engel, Ms. Norton, Mrs. Napolitano, Mr. Suozzi, Miss Rice of New York, Mr. Garamendi, Mr. Larson of Connecticut, Mr. Pallone, Ms. DeLauro, Mr. Ruppersberger, Mrs. Watson Coleman, Mr. Norcross, Mr. Malinowski, Mr. Sires, Mr. Lowenthal, Mr. Payne, Mr. Sean Patrick Maloney of New York, Mr. Meeks, Ms. Judy Chu of California, Mr. Costa, Mr. Gomez, Ms. McCollum, Mr. Rush, Mr. Panetta, Mr. Brendan F. Boyle of Pennsylvania, Ms. Meng, Mr. Courtney, and Ms. Sánchez) introduced the following bill; which was referred to the Committee on Ways and Means

A BILL

To amend the Internal Revenue Code of 1986 to repeal the dollar limitation on the deduction for State and local taxes and restore the 39.6 percent individual income tax rate bracket.

1.

Short title

This Act may be cited as the Stop the Attack on Local Taxpayers Act of 2019 or the SALT Act.

2.

Repeal of dollar limitation on deduction for State and local taxes

(a)

In general

Section 164(b)(6) of the Internal Revenue Code of 1986 is amended by striking all that follows January 1, 2026 and inserting , foreign real property taxes (other than such taxes paid or accrued in carrying on a trade or business or an activity described in section 212) shall not be taken into account under subsection (a)(1)..

(b)

Effective date

The amendment made by this section shall apply to taxable years beginning after December 31, 2018.

3.

Restoration of 39.6 percent rate bracket for individuals

(a)

In general

(1)

Married filing jointly and surviving spouses

The table contained in section 1(j)(2)(A) of the Internal Revenue Code of 1986 is amended by striking Over $400,000 and all that follows and inserting the following:

Over $400,000 but not over $470,700$91,379, plus 35% of the excess over $400,000.
Over $470,700$116,124, plus 39.6% of the excess over $470,700.

.

(2)

Heads of household

The table contained in section 1(j)(2)(B) of such Code is amended by striking Over $200,000 and all that follows and inserting the following:

Over $200,000 but not over $418,400$44,298, plus 35% of the excess over $200,000.
Over $418,400$120,738, plus 39.6% of the excess over $418,400.

.

(3)

Unmarried individuals

The table contained in section 1(j)(2)(C) of such Code is amended by striking Over $200,000 and all that follows and inserting the following:

Over $200,000 but not over $418,400$45,689.50, plus 35% of the excess over $200,000.
Over $418,400$122,129.50, plus 39.6% of the excess over $418,400.

.

(4)

Married filing separately

The table contained in section 1(j)(2)(D) of such Code is amended by striking Over $200,000 and all that follows and inserting the following:

Over $200,000 but not over $235,350$45,689.50, plus 35% of the excess over $200,000.
Over $235,350$58,062.50, plus 39.6% of the excess over $235,350.

.

(b)

Inflation adjustments to 39.6 percent rate

(1)

In general

Section 1(j)(3)(A) of such Code is amended by inserting (January 1, 2020, in the case of so much of the tables as relates to amounts to which the 39.6 percent rate applies) after January 1, 2019.

(2)

Adjustment rules

Section 1(j)(3)(B) of such Code is amended—

(A)

in the matter preceding clause (i), by inserting (December 31, 2019, in the case of so much of the tables as relates to amounts to which the 39.6 percent rate applies) after December 31, 2018,

(B)

in clause (i), by inserting except as provided in clause (iv) before subsection (f)(3) shall, and

(C)

by striking and at the end of clause (ii), by striking the period at the end of clause (iii) and inserting , and, and by adding at the end the following new clause:

(iv)

in the case of so much of the tables as relates to amounts to which the 39.6 percent rate applies, subsection (f)(3) shall be applied by substituting calendar year 2018 for calendar year 2016 in subparagraph (A)(ii) thereof.

.

(c)

Effective date

The amendments made by this section shall apply to taxable years beginning after December 31, 2018.