The State and Local Tax deduction cap is now $40,000, for some taxpayers, in some years. The political headline is straightforward; the practitioner reality is not. Section 70120 of the One Big Beautiful Bill Act amended IRC §164(b)(6) to raise the cap from $10,000 to $40,000 for tax years beginning after December 31, 2024, with a phaseout for taxpayers with modified adjusted gross income above $500,000. ¹ After tax year 2029, the cap reverts to $10,000.
This essay walks through the math, identifies the cliff, and explains who actually benefits, because in our practice, the answer is narrower than the press release suggests.
You've read the first three minutes.
The rest is free. Verify your email to continue.
We send a six-digit code to your inbox. Enter the code below to unlock the full essay and every other essay in the archive. The Journal arrives quarterly. Nothing else.
