Title: SALT Act
Policy area: Taxation

Summary:
Stop the Attack on Local Taxpayers Act or the SALT Act
This bill amends the Internal Revenue Code to (1) repeal the $10,000 limitation on individual income tax deductions for certain state and local taxes, and (2) increase the top individual income tax rate to 39.6% (currently 37%).

[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[S. 437 Introduced in Senate (IS)]

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116th CONGRESS
  1st Session
                                 S. 437

    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 SENATE OF THE UNITED STATES

                           February 11, 2019

  Mr. Menendez (for himself, Mr. Schumer, Mr. Wyden, Mr. Durbin, Mrs. 
   Murray, Mr. Booker, Mr. Cardin, Ms. Harris, Mr. Van Hollen, Mrs. 
  Feinstein, Mrs. Gillibrand, Ms. Duckworth, Mr. Blumenthal, and Mr. 
    Murphy) introduced the following bill; which was read twice and 
                  referred to the Committee on Finance

_______________________________________________________________________

                                 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 Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Stop the Attack on Local Taxpayers 
Act'' or the ``SALT Act''.

SEC. 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.

SEC. 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 households.--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 the Internal Revenue 
        Code of 1986 is amended by inserting ``(before January 1, 2020, 
        in the case of so much of such 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 such 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 such 
                        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.
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