2026 SALT Cap Calculator: What's Your State and Local Tax Deduction Limit?
For 2026 the state-and-local-tax deduction is capped at $40,400 — phased down by 30% of the MAGI excess over $505,000, but never below a $10,000 floor. This matters only if you itemize: if you take the standard deduction, the cap never touches your return.
Your 2026 SALT cap
Example: married filing jointly, $550,000 MAGI, $45,000 SALT paid → cap $26,900, so $18,100 of it is lost. Not sure of your MAGI? For most people it equals AGI — the MAGI Calculator walks through the add-backs.
The $40,400 cap, the phase-down, and the floor
Three moving parts, all written directly into the statute (IRC §164(b)(7), added by P.L. 119-21 §70120 — these are hardcoded statutory dollar amounts, not IRS inflation adjustments):
- The cap: $40,400 of state and local income (or sales) tax plus property tax is deductible in 2026 — up from $40,000 in 2025.
- The phase-down: above $505,000 of MAGI, the cap shrinks by 30¢ per extra dollar. At $550,000 MAGI (married filing jointly), the $45,000 excess takes $13,500 off the cap, leaving $26,900 — so a filer who paid $45,000 deducts $26,900 and loses $18,100.
- The floor: the phase-down stops at $10,000 — high earners never lose the SALT deduction entirely. At $700,000 MAGI the cap is exactly $10,000, and it stays there for any income above roughly $606,333.
If you paid less than your cap, you simply deduct what you paid: at $520,000 MAGI the cap is $35,900, but a filer who paid $8,000 deducts $8,000. Every figure in this section is computed at build time by the same tested engine as the calculator above.
Married filing separately: halve AFTER the floor
MFS filers get half of everything — but the order of operations matters. The engine first runs the phase-down on the full $40,400 cap using the halved $252,500 threshold, then applies the $10,000 floor, and only then divides by two. That produces a $20,200 starting cap and an effective $5,000 floor (reached at roughly $353,833 of MAGI). Worked through: at $300,000 MAGI, the phase-down leaves $26,150 on the full-cap scale, and halving gives a $13,075 cap — so of $25,000 paid, $13,075 is deductible. Halving the threshold arithmetic twice, or halving before the floor, gives a different (wrong) number.
2025, 2026, and the 2030 cliff
| Year | Cap | Phase-down threshold (MAGI) |
|---|---|---|
| 2025 | $40,000 | $500,000 |
| 2026 | $40,400 | $505,000 |
| 2027–2029 | Rises about 1% per year — exact figures await IRS guidance (no statutory rounding rule) | |
| 2030+ | $10,000 flat | No phase-down — the cliff written into the original OBBBA design |
The cap and threshold rise about 1% per year through 2029; exact 2028–2029 dollar amounts have no statutory rounding rule — awaiting IRS guidance.
This only matters if you itemize
The SALT deduction lives on Schedule A, so your applicable cap is irrelevant unless your total itemized deductions beat the 2026 standard deduction for your filing status. Two companion tools: the MAGI Calculator pins down the income figure the phase-down runs on (for most people MAGI equals AGI), and if you financed a new car, the Car Loan Interest Deduction Calculator covers the other big new OBBBA deduction — one you can take whether or not you itemize.
Frequently asked questions
Do high earners lose the SALT deduction entirely in 2026?
No — that is the most common misreading. The 30% phase-down stops at a $10,000 floor, so the cap never goes below $10,000 no matter how high your income is. The cap reaches the floor at roughly $606,333 of MAGI (about $353,833 married filing separately); above that it is simply $10,000 — the pre-OBBBA cap — not zero.
How does the SALT cap work for married filing separately?
Everything is halved, but in a specific order: the phase-down runs on the full $40,400 cap using the halved $252,500 MAGI threshold, the $10,000 floor applies, and only THEN is the result divided by two. That yields a $20,200 starting cap and an effective $5,000 floor. Halving before flooring — or halving the arithmetic twice — gives the wrong answer.
What happens to the SALT cap after 2026?
The cap and phase-down threshold rise about 1% per year through 2029 — exact 2028–2029 dollar amounts have no statutory rounding rule, so precise figures await IRS guidance. Then comes the cliff: from 2030 on, the statute reverts to a flat $10,000 cap with no phase-down. That reversion is written into the original OBBBA text (IRC §164(b)(7)(A)), not a prediction about future legislation.
Does the SALT cap matter if I take the standard deduction?
No. State and local taxes are an itemized deduction on Schedule A, so the cap only affects you if your total itemized deductions beat your standard deduction ($32,200 married filing jointly / $16,100 single in 2026). If you take the standard deduction, your SALT bill does not touch your federal return at all — check the standard deduction first.
Not tax advice: an educational estimate of the 2026 federal SALT cap only (tax year 2026, returns filed 2027) — no state tax, AMT, or NIIT modeling, and no judgment about whether itemizing beats your standard deduction. Figures come from IRC §164(b)(7) as added by P.L. 119-21 §70120; consult a tax professional or IRS.gov for your situation. Values are processed locally in your browser and never transmitted. See the methodology page.