The $40,400 SALT Cap: Is It Time to Itemize?
The $10,000 limit on State and Local Tax (SALT) deductions has been a major pain point for homeowners. For 2026, the OBBBA has provided substantial relief by raising the cap to $40,400 ($20,200 for married filing separately).
2/2/20261 min read
The Math:
Standard Deduction: For 2026, this is $16,100 (Single) and $32,200 (Joint).
High Earners: Note that the $40,400 cap begins to phase out if your income exceeds $505,000.
The Strategy: With the SALT cap four times higher than in previous years, many taxpayers will benefit more from itemizing on Schedule A than taking the standard deduction. If you live in a state with high property or income taxes, 2026 is the year to track every penny of those payments.
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