`Fiscal cliff’ deal preserves sales tax deduction

U.S. Sen. Maria Cantwell says the “fiscal-cliff” tax bill that passed the Senate early Wednesday includes the sales-tax deduction for taxpayers in Washington and a half-dozen other states. “This bill protects middle-class families from income taxes going up, and provides certainty for Washington state taxpayers and businesses by extending the state sales tax deduction for two years,” Cantwell said in prepared remarks. “Extending the state sales tax deduction puts an average of $500 back in the pockets of 850,000 Washington tax filers.” The deduction helps taxpayers who cannot deduct state income taxes because their state doesn’t tax income. Cantwell says the deal should help about 850,000 taxpayers who itemize their income tax returns about $500 on average. The tax break has previously been estimated to have a value of up to $500 million a year to Washington taxpayers.