SALT Deduction Cap 2026: $40,400, the $505,000 Phase-Out and a Table by Income

The state and local tax (SALT) deduction limit is $40,400 for 2026 ($20,200 if married filing separately), according to Internal Revenue Service (IRS) Publication 505, and it shrinks when modified adjusted gross income (MAGI) is more than $505,000. The IRS says it “will not be reduced below $10,000 ($5,000 if married filing separately).” The table below, which we computed from Public Law 119-21, shows the cap at six income levels, and a printable worksheet at the end of the story lists the taxes to gather.

SALT deduction cap 2026 by income

Public Law 119-21, Section 70120 sets the limit for taxable years beginning in 2026 at $40,400. It reduces that amount “by 30 percent of the excess (if any) of the taxpayer’s modified adjusted gross income over the threshold amount,” and says the reduction cannot take the limit below $10,000. The 2026 threshold is $505,000. For a married person filing separately the limit and the threshold are halved, and Publication 505 gives the floor as $5,000.

The formula is: cap = $40,400 minus 0.30 times (MAGI minus $505,000), never less than $10,000. Single filers, joint filers and heads of household use the same numbers; the separate-return column is half of each. These are our calculations from the law, not a table the IRS published.

MAGI (all but separate returns)	2026 cap	MAGI (married filing separately)	2026 cap (married filing separately)
$505,000 or less	$40,400	$252,500 or less	$20,200
$525,000	$34,400	$262,500	$17,200
$550,000	$26,900	$275,000	$13,450
$575,000	$19,400	$287,500	$9,700
$600,000	$11,900	$300,000	$5,950
$606,334 and above	$10,000	$303,167 and above	$5,000

How fast does the cap shrink?

Between $505,000 and about $606,333 of MAGI, each extra $1,000 of income cuts the limit by $300 (30 percent of $1,000), by our calculation. A filer at $550,000 is $45,000 over the threshold, so the reduction is $13,500 and the limit is $26,900. Once the reduction would pass $30,400, the $10,000 floor applies and more income changes nothing.

The law defines MAGI as “adjusted gross income increased by any amount excluded from gross income under section 911, 931, or 933,” which covers certain income earned abroad and in some U.S. territories.

What does the SALT cap cover?

IRS Topic 503, Deductible taxes (reviewed Sept. 24, 2026), lists what counts toward the deduction.

Tax	What the IRS says
Income taxes	“State, local, and foreign income taxes or state and local general sales taxes in lieu of state and local income taxes”
Sales taxes	The election is made “by checking box 5a on Schedule A”
Real property taxes	Taxes “levied for the general public welfare”
Personal property taxes	“Based only on the value of personal property, such as a boat or car, and must be charged to you yearly”

Topic 503 also says, “You deduct the tax in the taxable year you pay them.” A property tax bill paid by Dec. 31, 2026 therefore counts for 2026 if you pay it then. The topic page still prints $40,000 with no year, which is the 2025 limit; Publication 505 gives the 2026 figure of $40,400. Check the due dates on your own tax bills against the December 2026 printable calendar and our list of year-end money deadlines.

Do you need to itemize to use it?

Yes. The SALT deduction is claimed on Schedule A (Form 1040), and it only helps when itemized deductions are larger than the standard deduction. The IRS inflation adjustments for 2026 (IR-2025-103, Oct. 9, 2025) set the standard deduction at $16,100 for single filers and married people filing separately, $32,200 for married couples filing jointly and $24,150 for heads of household. The instructions for the 2026 Schedule A are not yet released.

How do the SALT limit and threshold change after 2026?

Public Law 119-21 sets both amounts by year.

Tax year	Limit	Threshold	Source
2025	$40,000	$500,000	Public Law 119-21; 2025 Schedule A instructions
2026	$40,400	$505,000	Public Law 119-21; Publication 505
2027 to 2029	101 percent of the prior year’s amount	101 percent of the prior year’s amount	Public Law 119-21
2030 and later	$10,000	Not stated in our sources	Public Law 119-21

The 2025 Schedule A instructions say the limit “has increased to $40,000” and apply the reduction above $500,000 ($250,000 if married filing separately), using the line “Multiply line 6 by 30% (0.30).” The IRS has not yet published the 2027 figures. By our calculation from the law, 101 percent of $40,400 is $40,804 and 101 percent of $505,000 is $510,050.

SALT cap worksheet to print

The one-page 2026 SALT Deduction Cap Worksheet below lists the limit, the phase-out rate, the floor, the taxes to gather and the Dec. 31, 2026 payment rule, each with its source. Add up the state and local taxes you paid, then find your MAGI on your 2026 return. Work out the income over $505,000 and take 30 percent of it. Withholding on W-2 forms and estimated payments show the income taxes you paid. Payments made by Dec. 31, 2026 count for 2026. Keep the sheet with your tax papers, and mark filing dates on the April 2027 printable calendar or the 2027 printable yearly calendar. Other 2027 limits are in our tax brackets, 401(k) and health savings account (HSA) limits guide, and filing dates are in the 2027 IRS tax calendar.