Add SALT to tax bill
After weeks of uncertainty, both Congress and the Senate passed a controversial tax bill; the latter vote was 51-49. The bill will still be debated and perhaps changes will be made before it can be enacted. Let’s hope so, because this was a one-sided victory since it did not receive any Democratic support. That alone is reason to suspect what many critics have been saying all along: that this plan is not palatable to middle-class Americans, and that is especially true for those of us on Long Island. One solution? Add SALT.
State and local taxes (SALT) have been an important aspect of filing annual taxes. Having those deductions provided some reprieve for residents of one of the highest-taxed areas of the country. However, this proposed tax bill eliminates that deduction. Ouch!
Suffolk County homeowners pay on average close to $10,000 a year in taxes, the majority of which goes to schools, followed by local government, the county and police. Let’s face it – after the mortgage, your property tax rate is the highest household expense. And although the bill allows property deductions up $10,000, that’s not nearly enough for many of the households in the county and much of Islip Town.
It may not be an issue for other areas of the country, though. The average tax bill in the United States is $2,403 per year, according to the U.S. Census Bureau’s American Community Survey. Suffolk County has a property tax rate of 7.57 percent, which ranks it eighth in the nation as the highest taxed. Nassau County is at 8.26 percent and in fourth place. Yet, there are people on Long Island whose median household incomes and home values are the same or even below the average U.S. households, and they’re paying more than triple the amount of taxes than the rest of the country.
Although taxes do pay for many essential services we have all come to expect, such as public schools, public safety and infrastructure, the high tax rate on Long Island has been a significant contributor to the exodus of both senior citizens and the younger generation, who have moved on to reside in more affordable places. The one salvation has been property tax deduction. If it is indeed eliminated, we should expect to see that pattern of departure continue and most likely increase, pushing away many businesses and middle-age professionals as well.
Like what you have read? Click here to subscribe to the The Islip Bulletin so you can read more stories like this, and find out everything that’s going on in your town!