Congressional lawmakers are debating the future of the state and local tax (SALT) deduction that was capped at $10,000 by the Tax Cuts and Jobs Act (TCJA). Itemizing taxpayers use the deduction to reduce federal income for their property, state and local taxes. The TCJA’s cap is scheduled to expire after 2025, and many residents of high-tax states welcome the possible return of unlimited SALT deductions. Some Republican legislators want to raise or repeal the SALT cap and President-elect Trump has said he’ll “get SALT back.” But the Committee for a Responsible Federal Budget estimates that raising the SALT cap to $20,000 would reduce federal revenue by $170 billion.
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