Members of Congress have done something right: They’ve made federal income tax deductions a permanent thing for Texans and residents of six other states that finance their operations through a sales tax instead of a state income tax.
The state and local sales tax deduction has been available since 2004. It’s an issue of tax fairness — people in places where there’s a state income tax have long been allowed a federal deduction for those payments.
Why should the tax code treat people differently based on how their states raise tax money?
More than 2 million Texans have taken advantage of the provision each year through itemized deductions, collectively saving about $1 billion a year on their federal income taxes.
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But deductions for sales tax payments have been a temporary thing, subject to congressional debate and political wrangling every year or so when the provision would expire.
Now, that uncertainty is over. The tax package approved this week makes the deduction permanent.