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Trump's promise to repeal SALT caps revives the fight on Capitol Hill

  • House lawmakers are gearing up for a battle over the SALT deduction, which is capped at $10,000.
  • Meetings have already started to take place on Capitol Hill on how to bring back and maintain the original full deduction.
  • Some House Republicans are pushing their party's leadership to look at alternative payment methods for Donald Trump's tax plan.

House lawmakers are using former President Donald Trump's own words as leverage to pressure their colleagues into preserving the original state and local tax deduction, with a fight set to take shape next year.

The SALT deduction allows tax payers to deduct up to $10,000 of property, sales or income taxes that have already been paid to state and local governments. Historically, most of the tax payers who claim the deduction reside in high tax states such as New York, Connecticut, New Jersey and California.

But the cap on SALT became law when Trump was president and after he signed his $1.5 trillion tax bill in 2017, using the new version of the deduction as a pay for method. There was no cap on SALT prior to the Trump tax bill.

House lawmakers are now strategizing how to maintain what could be an unlimited SALT tax deduction in the next Congress, as the SALT cap provision from the Trump tax bill is set to expire on Dec. 31, 2025.

If Trump becomes president again, and Republicans have a majority in both the House and Senate, some House Republicans are pushing their party's leadership to look at alternative payment methods for Trump's tax plan, which includes cutting the corporate tax rate from 21% to 15%, according to Rep. Andrew Garbarino, R-N.Y.

Some of those recent conversations have featured Trump's new stance on bringing back the full SALT deduction, despite his bill being

Read more on cnbc.com