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Collins Introduces Legislation to Address Unfair Tax Penalty for Married Americans

Washington, D.C. —U.S. Senator Susan Collins (R-ME) introduced the SALT Deduction Fairness Act to ensure that limits on State and Local Tax deductions—also known as SALT deductions—do not penalize married filers.

“As Tax Day approaches, Americans families have begun calculating their taxes and filling out 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.”

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.  This means that single filers and married filers are treated the same.  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 3rd highest overall tax burden, behind only New York, Hawaii, and Vermont.  Yet Maine’s median household income ranks only 32nd in the nation and is approximately $5,000 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 worked 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.