# SALT Deduction Fairness Act

This bill would remove the $10,000 cap on the State and Local Tax (SALT) deduction that currently limits how much you can deduct from your federal taxes for state and local income taxes, property taxes, and sales taxes combined.

Right now, if you pay $15,000 in state income tax and property taxes, you can only deduct $10,000 of that on your federal tax return. The rest doesn't help reduce your federal tax bill. This cap was put in place in 2017 and affects millions of Americans, particularly those in high-tax states like New York, California, New Jersey, and Connecticut. The SALT Deduction Fairness Act would eliminate this limit entirely, allowing you to deduct all of your state and local taxes paid, not just the first $10,000.

This change would primarily benefit higher-income households and people living in states with higher tax rates, since they're the ones most affected by the current cap. If you live in a state with high property taxes or income taxes and earn a substantial income, removing this cap could mean a larger tax deduction and lower federal taxes owed. However, this would also reduce federal tax revenue, which could affect government spending or require other tax changes to make up the difference. The bill essentially shifts more of the tax burden away from people in high-tax states and potentially toward other taxpayers or requires cuts elsewhere in the budget.

SALT Deduction Fairness Act

Collins, Susan M.

 <p> <strong>SALT Deduction Fairness Act</strong></p> This bill increases to $20,000 the amount that a married couple filing a joint tax return may deduct for certain state and local taxes.