Stop the Attack on Local Taxpayers Act of 2019

I 116TH CONGRESS 1ST SESSION H. R. 1142 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. IN THE HOUSE OF REPRESENTATIVES FEBRUARY 11, 2019 Mr. PASCRELL (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. NOR- CROSS, 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. PA- NETTA, Mr. BRENDAN F. BOYLE of Pennsylvania, Ms. MENG, Mr. COURTNEY, and Ms. SA´NCHEZ) 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. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 VerDate Sep 11 2014 23:42 Feb 21, 2019 Jkt 089200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H1142.IH H1142 kjohnson on DSK79L0C42 with BILLS 2 •HR 1142 IH SECTION 1. SHORT TITLE. 1 This Act may be cited as the ‘‘Stop the Attack on 2 Local Taxpayers Act of 2019’’ or the ‘‘SALT Act’’. 3 SEC. 2. REPEAL OF DOLLAR LIMITATION ON DEDUCTION 4 FOR STATE AND LOCAL TAXES. 5 (a) IN GENERAL.—Section 164(b)(6) of the Internal 6 Revenue Code of 1986 is amended by striking all that fol- 7 lows ‘‘January 1, 2026’’ and inserting ‘‘, foreign real prop- 8 erty taxes (other than such taxes paid or accrued in car- 9 rying on a trade or business or an activity described in 10 section 212) shall not be taken into account under sub- 11 section (a)(1).’’. 12 (b) EFFECTIVE DATE.—The amendment made by 13 this section shall apply to taxable years beginning after 14 December 31, 2018. 15 SEC. 3. RESTORATION OF 39.6 PERCENT RATE BRACKET 16 FOR INDIVIDUALS. 17 (a) IN GENERAL.— 18 (1) MARRIED FILING JOINTLY AND SURVIVING 19 SPOUSES.—The table contained in section 1(j)(2)(A) 20 of the Internal Revenue Code of 1986 is amended by 21 striking ‘‘Over $400,000’’ and all that follows and 22 inserting the following: 23 ‘‘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.’’. VerDate Sep 11 2014 23:42 Feb 21, 2019 Jkt 089200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6211 E:\BILLS\H1142.IH H1142 kjohnson on DSK79L0C42 with BILLS 3 •HR 1142 IH (2) HEADS OF HOUSEHOLD.—The table con- 1 tained in section 1(j)(2)(B) of such Code is amended 2 by striking ‘‘Over $200,000’’ and all that follows 3 and inserting the following: 4 ‘‘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 con- 5 tained in section 1(j)(2)(C) of such Code is amended 6 by striking ‘‘Over $200,000’’ and all that follows 7 and inserting the following: 8 ‘‘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 ex- cess over $418,400.’’. (4) MARRIED FILING SEPARATELY.—The table 9 contained in section 1(j)(2)(D) of such Code is 10 amended by striking ‘‘Over $200,000’’ and all that 11 follows and inserting the following: 12 ‘‘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 13 RATE.— 14 (1) IN GENERAL.—Section 1(j)(3)(A) of such 15 Code is amended by inserting ‘‘(January 1, 2020, in 16 the case of so much of the tables as relates to 17 VerDate Sep 11 2014 23:42 Feb 21, 2019 Jkt 089200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H1142.IH H1142 kjohnson on DSK79L0C42 with BILLS 4 •HR 1142 IH amounts to which the 39.6 percent rate applies)’’ 1 after ‘‘January 1, 2019’’. 2 (2) ADJUSTMENT RULES.—Section 1(j)(3)(B) 3 of such Code is amended— 4 (A) in the matter preceding clause (i), by 5 inserting ‘‘(December 31, 2019, in the case of 6 so much of the tables as relates to amounts to 7 which the 39.6 percent rate applies)’’ after 8 ‘‘December 31, 2018’’, 9 (B) in clause (i), by inserting ‘‘except as 10 provided in clause (iv)’’ before ‘‘subsection 11 (f)(3) shall’’, and 12 (C) by striking ‘‘and’’ at the end of clause 13 (ii), by striking the period at the end of clause 14 (iii) and inserting ‘‘, and’’, and by adding at the 15 end the following new clause: 16 ‘‘(iv) in the case of so much of the ta- 17 bles as relates to amounts to which the 18 39.6 percent rate applies, subsection (f)(3) 19 shall be applied by substituting ‘calendar 20 year 2018’ for ‘calendar year 2016’ in sub- 21 paragraph (A)(ii) thereof.’’. 22 VerDate Sep 11 2014 23:42 Feb 21, 2019 Jkt 089200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H1142.IH H1142 kjohnson on DSK79L0C42 with BILLS 5 •HR 1142 IH (c) EFFECTIVE DATE.—The amendments made by 1 this section shall apply to taxable years beginning after 2 December 31, 2018. 3 Æ VerDate Sep 11 2014 23:42 Feb 21, 2019 Jkt 089200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6301 E:\BILLS\H1142.IH H1142 kjohnson on DSK79L0C42 with BILLS