House GOP leaders discussed a new, heightened state-and-local-tax deduction with a group of Republican holdouts as they race to salvage their party-line megabill from ruin.
A $40,000 cap on the key deduction for individuals and $80,000 cap for joint filers was part of a list of items GOP leaders raised overnight as they scrambled to shore up ultraconservative votes, according to three people granted anonymity to describe the private conversations.
The SALT cap increase is one of the biggest hangups in the bill, which is filled with President Donald Trump’s domestic policy priorities. A band of SALT Republicans are publicly pushing for the cap increase to hit $62,000 for individuals and double for joint filers; conservatives generally oppose lifting the existing $10,000 cap, which generally hits high-tax coastal states rich in Democratic votes.
The fact that leadership discussed a specific number with the hard-liners suggests that they see the $40,000/$80,000 cap as a likely final compromise.
As a way to pay for the bump, leaders and holdouts discussed moving up the 2029 start date for Medicaid work requirements, which Republican leaders are working with the White House on. They also talked over the hard-liners’ demands to more quickly scale back Inflation Reduction Act tax credits. But leaders warned that rapidly moving up the tax credit phase-out doesn’t have the votes to pass, according to the people.
Talks are expected to continue through the weekend after the hard-liners tanked a House Budget Committee vote Friday.