(From the latimes.com) You may be unaware of the local ramifications of one of the proposals currently at play in the danse macabre that passes for fiscal negotiations in Washington.
This is the plan to cap federal tax deductions at either a set figure or a percentage of income. Either way, it would strike deepest and hardest mostly at residents of California, as well as other populous states with high levels of government services, high state and local taxes, and relatively expensive housing.
The mortgage interest and state and local tax deductions are among the most important tax breaks that would be capped under this sort of proposal. They’re linchpins of middle-class tax planning in the most heavily affected states, which also include New York, Illinois, Massachusetts and Connecticut.
These states, of course, are also of the deepest blue, politically speaking. They also tend to support the broadest range of public services, such as healthcare for the needy. That’s what’s under attack.
Read more here: Proposed cap on federal tax deductions would hit California hard