Says Real Tax Relief Will Occur When Path To Progress Reforms Are Implemented
Senator Steven Oroho said that a lawsuit announced today by Governor Phil Murphy and Attorney General Gurbir Grewal against the Internal Revenue Service amounts to window dressing and won’t provide meaningful, long-term property tax relief to New Jersey families.
Sen. Steven Oroho said that the Governor’s lawsuit against the IRS won’t provide meaningful, long-term property tax relief to New Jersey families. (Pixabay)
“New Jersey homeowners are the most overtaxed residents in the United States,” Oroho said. “The lawsuit announced today does very little to address that. The better approach would be to fix the state’s underlying tax problems that make the SALT limitation an issue. Governor Murphy can help make the Garden State more competitive and accomplish real savings for taxpayers by getting behind the Path to Progress reforms that have bipartisan support in the Legislature.”
Governor Murphy and Attorney General Grewal today announced a lawsuit against the Internal Revenue Service to challenge federal regulations that prohibited an attempt by New Jersey to sidestep the $10,000 cap on the federal income tax deduction for state and local taxes (SALT).
Federal tax reforms enacted in 2017 limited the SALT deduction to $10,000, while allowing charitable contributions to remain fully deductible. Following the federal action, the state enacted a workaround law which allowed taxpayers to shift property tax payments to local charitable funds that could be created to support government functions in exchange for offsetting tax credits.
The IRS regulations, however, clarified that the federal income tax deduction for a charitable contribution to a local municipal fund would be reduced by the value of a state or local tax credit that a taxpayer receives in return for making such a contribution.
Senator Oroho served as a co-chair of the bipartisan NJ Economic & Fiscal Policy Workgroup to investigate and recommend cost-saving government reforms that were proposed in the Path to Progress report.
“We proposed cost-saving recommendations in a bipartisan fashion that could save New Jersey taxpayers billions annually,” Oroho added. “Addressing the real cost drivers to government, mainly the exploding expenses of pensions and benefits, would lead to significant savings for New Jersey homeowners. I urge the Governor to get behind the fiscal reforms proposed by the Legislature as the best way to relieve the burden on overtaxed Garden State families, and not engage in mere window dressing policies.”
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