Senator Collins Introduces Legislation to Fix Unfair Tax Penalty for Married Americans

Press Release

U.S. Senator Susan Collins delivered remarks from the Senate floor this evening to urge her colleagues to support the SALT Deduction Fairness Act, legislation she introduced to ensure that limits on State and Local Property Tax deductions--also known as SALT deductions--do not penalize married filers.

"This is the time of year when many Americans are calculating their taxes and filling out their returns. We should not create a situation where married couples would have been better off financially were they not married," said Senator Collins. "The SALT Deduction Fairness Act would ensure that limits on SALT deductions do not disproportionately and unfairly penalize married filers by simply doubling the deduction to $20,000 for married filers. I urge my colleagues to support this common sense bill to fix this marriage penalty."

Currently, the amount of state and local taxes that both single and married filers may deduct from their annual income taxes is capped at $10,000. Single filers and married filers are treated the same. Additionally, married people who file their taxes separately are limited to $5,000 each. In other words, individuals would be better off not getting married at all when it comes to the SALT deduction. The SALT Deduction Fairness Act would remove this penalty by simply doubling the deduction to $20,000 for married filers.

Last year, an analysis by WalletHub, found that Maine had the 4th highest overall tax burden, behind only New York, Hawaii, and Vermont. Yet Maine's median household income ranks only 35th in the nation and is approximately $6,800 below the U.S. median household income. Maintaining this SALT deductions provides important tax relief for Mainers who continue to itemize their deductions.

When the Senate considered the Tax Cuts and Jobs Act in 2017, Senator Collins fought to keep the SALT deduction in the federal tax code because of the increased tax burden its elimination would have imposed on many Mainers who have seasonal camps as well as homes, pay annual excise taxes on their vehicles, and are subject to state income taxes. The SALT deduction has been in the tax code since 1913 when the income tax was first established. It is intended to protect working families from double taxation. During tax reform, the Senate retained deductions related to state and local taxes because of Senator Collins' efforts.

Source