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SALT Cap Calculator

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SALT deduction savings calculator

Which tax year are you asking about?

The limit creeps up about 1% a year through 2029, then drops back to $10,000 in 2030

The 2025 and 2026 figures are final. After that it is $40,804 for 2027 and about 1% more each year through 2029. For tax years beginning in 2030 it reverts to a flat $10,000, permanently, with no shrinking at higher incomes. More on that below.

No state income tax where you live? Put the general sales tax you paid in this box instead

What your state, city, or county took out of your pay for the year, plus anything more you paid them at filing time. You may claim state income tax or general sales tax, one or the other, never both.

These two boxes added together are what the law calls your SALT

What you paid on your home and land, plus any yearly tax your state charges on what a car or boat is worth. Renting, and no such car tax? Put 0.

Not your gross pay: your adjusted gross income is line 11a on your Form 1040, after money you put into a 401(k) or an HSA has already come out.

This figure is what decides whether your limit gets cut

If you filed last year, this is line 11a on your Form 1040. Married and filing one return together? Use the one figure from your joint return. It only matters above $500,000 ($505,000 in 2026), where the limit starts shrinking. Tax forms measure that against your modified adjusted gross income, which for almost everyone is the same figure.

How do you file your taxes?

Sending in separate returns halves the limit, the income level and the floor

The limit, the income level where it starts shrinking, and the floor it stops at are each cut in half for married couples who each send their own return. Your standard deduction is not halved, though: filing separately, it is the same amount a single filer gets. Filing one return together does not double anything either: a couple gets the same limit as a single person, which is the same "marriage penalty" the old $10,000 limit had.

Mainly mortgage interest and donations to charity, for a full year

Do not count the state and local taxes you just entered, those are already in. Listing expenses like these one by one, instead of taking the flat amount everyone is offered, is called itemizing, and it is the only way the limit on this page can matter to you at all. The $10,000 shown is only an example, replace it with your own figure.

Your answer

These are example numbers. Type yours to see your own.

Does the bigger limit help if I owe the alternative minimum tax?

Less, or not at all. State and local taxes are added back on Form 6251 (line 2a) when your alternative minimum taxable income is worked out, so a filer pulled into the AMT loses some or all of the benefit of the bigger cap. This tool does not model the AMT, pass-through entity tax elections, or the other Schedule A limits.

The 2025 One Big Beautiful Bill Act raised the cap on deducting state and local taxes (SALT) from $10,000 to $40,000 for 2025 ($40,400 for 2026) — but only for itemizers, and it phases back down above $500,000 of income. Enter your numbers to see your allowed SALT deduction, whether itemizing beats your standard deduction, and what the raise actually saves you. Everything runs in your browser — nothing is uploaded.

Estimate for general guidance only — not tax advice. The tax-saving figure compares your best deduction under the new cap against the old $10,000 cap in the same year, using the 2026 federal brackets (married filing separately is estimated with the single table). It does not model the AMT, PTET elections, or other Schedule A limits. Verify with the IRS or a tax professional.

Does everyone get a $40,000 deduction now? No — three catches

1. Itemizers only. SALT is an itemized deduction (Schedule A). With the 2025 standard deduction at $15,750 single / $31,500 married filing jointly, roughly nine in ten filers take the standard deduction — and get $0 from this change. You benefit only to the extent your capped SALT plus other itemized deductions exceed your standard deduction.

2. You deduct what you paid, up to the cap. The cap is a ceiling, not a grant. If you paid $14,000 in state and local taxes, you deduct $14,000 — not $40,000.

3. High earners phase back to $10,000. Above $500,000 of income (2025), the cap shrinks by 30 cents per extra dollar. By $600,000 you are back at the old $10,000 cap — that floor is as low as it goes, but for six-figure-SALT households the raise is fully gone. And in 2030 the cap reverts to a flat $10,000 for everyone, with no phase-down.

How the new SALT cap works

The One Big Beautiful Bill Act (signed July 2025) amended Internal Revenue Code §164(b)(6). What counts as SALT is unchanged: state and local income taxes (or general sales taxes in lieu, your choice) plus real-estate and personal-property taxes, all still claimed on Schedule A.

The cap by year. $40,000 for 2025, $40,400 for 2026, $40,804 for 2027, then 101% of the prior year through 2029 (about $41,212 and $41,624 — the IRS hasn't published official figures for those years yet). Married filing separately gets exactly half each year. For tax years beginning in 2030 the cap reverts to $10,000 ($5,000 married filing separately), permanently and with no phase-down.

The phase-down (2025–2029). The cap is reduced by 30% of the amount your MAGI exceeds the threshold — $500,000 in 2025, $505,000 in 2026, $510,050 in 2027 (half those amounts for married filing separately) — but never below $10,000 ($5,000 married filing separately). In 2025 the cap is fully phased back to $10,000 at $600,000 of income; in 2026 at about $606,333.

Filing jointly vs separately. Unusually, the cap is not doubled for joint filers — a married couple filing jointly gets the same $40,000 as a single filer, while married filing separately gets half. This is the same "marriage penalty" structure the old $10,000 cap had.

Working overtime or earning tips? The same law added separate deductions — see the no tax on overtime calculator and the no tax on tips calculator. 65 or older? There's also the $6,000 senior bonus deduction. Bought a new car? You can deduct up to $10,000 of the loan interest — see the car loan interest deduction calculator.

The SALT torpedo: a 45.5% marginal rate zone

Inside the phase-down band — roughly $500,000 to $600,000 of income in 2025 — each extra dollar you earn also strips away 30 cents of SALT deduction (if your SALT paid is at least the current cap). Your taxable income therefore rises by $1.30 for every $1 earned: in the 35% bracket that is an effective marginal rate of 1.3 × 35% = 45.5%, and in the 37% bracket 48.1%. Tax professionals have dubbed this the "SALT torpedo." Sanity check across the whole band: earning $100,000 more (from $500,000 to $600,000) costs $30,000 of deduction, so taxable income rises $130,000 — at 35% that is $45,500 of tax on $100,000 of income, i.e. 45.5%. If you can time income (bonuses, Roth conversions, capital gains) to stay out of the band, each dollar kept out avoids the surcharge.

Common questions

What is the SALT cap for 2025 and 2026? $40,000 and $40,400 ($20,000 / $20,200 married filing separately), phased down by 30% of income over $500,000 / $505,000, never below the $10,000 / $5,000 floor.

When does the $40,000 cap end? After 2029. From 2030 the cap is a flat $10,000 ($5,000 married filing separately) again — no phase-down, no indexing.

Did the PTET workaround survive? Yes. The final law places no restrictions on state pass-through entity taxes — the House version's limits were dropped in the Senate. Owners of pass-through businesses in PTET states can still deduct state tax at the entity level, outside the cap.

Does the bigger cap help under the AMT? Less or not at all — SALT is added back on Form 6251 (line 2a) when computing alternative minimum taxable income, so filers in AMT territory lose some or all of the benefit.

What does itemizing mean? Itemizing is listing specific deductible expenses — SALT, mortgage interest, charitable gifts — on Schedule A and deducting the total, instead of taking the flat standard deduction. You take whichever is larger, and the SALT cap only matters if you itemize.

What is the standard deduction? A flat amount you can subtract from income without listing any expenses — $15,750 single / $31,500 married filing jointly for 2025. If it beats your itemized total, you take it and the SALT cap doesn't affect your return.

What is filing status? The category you file under — single, married filing jointly, married filing separately, or head of household. It sets your cap, income threshold, and floor; married filing separately gets exactly half of each.

Is anything saved or uploaded? No. The tool is fully client-side — your numbers never leave your browser.

Sources: Public Law 119-21 §70120, statute text (congress.gov); 26 USC §164 as amended (Cornell LII); IRS, One Big Beautiful Bill provisions and Rev. Proc. 2025-32; Kitces, OBBBA tax planning; Thomson Reuters, SALT deduction; IRS, Form 6251 instructions.

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