The Nstein tax desk
2026 SALT Deduction: Cap & Income Limits
Understand the 2026 federal state and local tax deduction cap, income limits, and the records needed to review itemizing.
What changed for 2026?
The combined federal deduction limit for eligible state and local taxes is $40,400, or $20,200 for married filing separately. This is an itemized deduction, not an automatic credit or a guaranteed refund.
Income can reduce the limit
The cap is reduced above modified adjusted gross income of $505,000, or $252,500 for married filing separately. The cap cannot fall below $10,000, or $5,000 for separate filers. Have the applicable calculation reviewed rather than assuming the full cap is available.
What to bring
Bring state income-tax payment records and eligible property-tax bills. Your preparer can compare total itemized deductions with the standard deduction. Yeshiva tuition is not a state or local tax and does not become deductible under the SALT cap.
Why the distinction matters
A higher limit does not mean everyone saves more. If your standard deduction is larger, or income limits reduce your cap, the result will differ. Discuss your records through tax planning.