A White House proposal to eliminate the tax deduction for state and local taxes would hit Democratic voters hardest, a CNBC analysis shows.
As congressional Republicans and the Trump administration put the finishing touches on their plan to overhaul the nation's tax code, much of the attention will be focused on changes that will eliminate popular tax breaks to help pay for the revenue lost from lowering tax rates.
And among those reportedly in the plan's crosshairs is a long-standing provision that lets you deduct from your reported income the money you pay in state and local taxes on income, real estate or sales of big-ticket items.
The popular provision may be on the tax reform chopping block for a simple reason: eliminating it would generate tens of billions of dollars in revenue needed to offset the money lost from lowering tax rates on individuals and corporations.
Taxpayers in California and New York, among the bluest states in the country, would be the hardest hit. Of the total deductions claimed nationwide, half of the benefit in 2014 went to just seven states — California, New York, New Jersey, Illinois, Connecticut, Massachusetts and Maryland, according to a report from the Tax Foundation.
To read full article on CNBC - http://v.duta.us/hxa9vAAA