Tax Tip #255

The $10,000 cap on State & Local Tax (SALT) deductions has been raised to $40,000 for most taxpayers. The benefit phases out for households with adjusted gross income (AGI) exceeding $500,000. In 2026, the thresholds would increase by 1% or to $40,400 for households with income under $505,000. The thresholds would continue to increase by 1% each year through 2029, after which the SALT limit would be permanently reduced to $10,000.

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