Next step: Bill Biden to bring back the property tax deduction for most NJ homeowners

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Following President Joe Biden’s signing on Monday on a bipartisan $ 1,000 billion infrastructure bill, the House is expected to turn its attention later this week to a $ 1.75 trillion proposal that would restore the major part of the federal deduction for state and local taxes.

While still subject to further changes, legislation slated to be voted on by the end of the week would increase the amount that can be deducted up to $ 80,000 until 2030, the 10,000 cap. $ returning in 2031.

Meanwhile, the infrastructure bill would provide at least $ 13.5 billion to the state, in addition to allocating billions of dollars that could be used to build the long-awaited Gateway Tunnel under the Hudson River.

“They are both extremely important to us in different ways,” said Rep Josh Gottheimer, D-5th Dist.

Biden highlighted the two bills during his trip to Kearny on October 25 and again on Monday when he signed the infrastructure legislation.

“With the infrastructure bill millions of lives will be changed for the better,” Biden said in the White House.

The second bill would also extend by one year the expanded child tax credit for lower and middle class families, which was part of Biden’s $ 1.9 billion coronavirus stimulus bill that rejected the unanimous opposition of the Republicans.

According to a study published on Monday by the Center on Budget and Policy Priorities, a progressive research group, the extended credit would benefit 1.6 million children in New Jersey and raise 93,000 above the poverty line.

Another 388,400 New Jersey adults without children would benefit from the bill’s expanded income tax credit, the center said.

The bill would also limit a family of four earning up to $ 308,575, or 2 1/2 times the state’s median income, to paying no more than 7% of their income for child care. , according to the White House. Vice President Kamala Harris highlighted efforts to reduce the cost of child care services when she visited the Ben Samuels Children’s Center at Montclair State University in Little Falls on October 8.

The legislation also provides funding to expand health coverage, provide nursery school for 3- and 4-year-olds and tackle climate change, as well as a permanent ban on offshore oil drilling in the Atlantic Ocean and a provision to reduce prescription costs by allowing Medicare to negotiate the prices of certain drugs.

Unlike the infrastructure bill, Democrats are not expecting any GOP support for the second measure. Already one of the New Jersey Republicans who voted yes, Rep. Jeff Van Drew, R-2nd Dist., Has said he will oppose the second measure, saying it will “change America as it is. that we know it “.

Even as Biden saw his approval ratings drop and voters clashed with Democratic candidates, Gov. Phil Murphy survived a tighter-than-expected re-election race and Republicans won the governorship in Virginia.

a ABC News / Washington Post Poll published on Sunday gave Biden a 41% approval rating among American adults, with 53% disapproval. At the same time, its infrastructure plan was supported by 63% to 32%, and its second spending was supported by 58%, with 37% opposition.

Rep. Tom Malinowski, one of four New Jersey Democratic incumbents targeted by House Republicans, said passing the two bills could change the narrative.

“This is a two-part piece called ‘Keeping Our Promises,’ said Malinowski, D-7th Dist. “We were elected to deliver. I expect to be held accountable for what I do and what I fail to achieve. At the moment, things are looking pretty good in this department. “

The American Action Network, a Republican-leaning nonprofit that does not disclose its donors, began running ads Monday against Malinowski and Garden State Democrat, Rep. Andy Kim, D-3rd Dist., For their support for the second spending bill.

The ads are part of a $ 2 million campaign in eight districts against the legislation.

Malinowski and Kim both ousted Republican incumbents in 2018, in part because of Republican-sponsored tax law that limited the federal deduction for state and local taxes, known as SALT.

In addition, two-thirds of people receiving the deduction in New Jersey, the state with the highest property taxes in the country, had incomes between $ 75,000 and $ 200,000, according to statistics from the Internal. Revenue Service.

“I can’t wait for the Republicans to attack me for reinstating the SALT deduction for homeowners in my neighborhood,” said Malinowski.

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Jonathan D. Salant can be reached at jsalant@njadvancemedia.com. Follow him on @JDSalant.

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