SALT Deduction

Definition

The State and Local Tax deduction lets taxpayers deduct state income taxes (or sales taxes) and property taxes on Schedule A. For tax year 2025 the cap is $40,000 ($20,000 married filing separately). The cap phases down above the applicable modified AGI threshold but not below the statutory floor. Confirm the client's MAGI before applying the full amount. Source: IRS Publication 17 / Schedule A guidance for 2025 (https://www.irs.gov/publications/p17); last reviewed 2026-08-01.

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