The state & local tax (SALT) deduction cap jumped to $40,400 for 2026 (up from $10,000). See how much of your state, local and property taxes you can now deduct — and the extra benefit vs the old cap. ✓ 2026 IRS figures
2026 $40,400 limit • Itemizers
The One Big Beautiful Bill raised the state and local tax (SALT) deduction cap from $10,000 to $40,000 in 2025 and $40,400 in 2026, indexed through 2029 before reverting to $10,000 in 2030. SALT includes state/local income (or sales) tax plus property tax. It's an itemized deduction, so it only helps if your total itemized deductions beat the standard deduction ($16,100 single / $32,200 joint in 2026).
For high earners, the higher cap phases down by 30% of modified AGI above roughly $505,000, never falling below $10,000. The big winners are homeowners in high-tax states who previously lost most of their SALT deduction. This is an estimate, not tax advice.