• There's currently a $10,000 limit on the federal deduction on state and local taxes, known as SALT, which will sunset Dec. 31, 2025, without action from Congress.
• It's been a key issue for lawmakers in high-tax states and could change amid negotiations for President Donald Trump's policy agenda.
• However, SALT cap increases would primarily benefit higher earners who are more likely to itemize deductions, experts say.

As debates ramp up for President Donald Trump's policy agenda, changes to a  could benefit higher earners, experts say. 

Enacted via the , or TCJA, of 2017, there's a on the federal deduction on state and local taxes, known as SALT, which will without action from Congress.

Currently, if you itemize tax breaks, you can't deduct more than $10,000 in levies paid to state and local governments, including income and property taxes.

Raising the SALT cap has for certain lawmakers from high-tax states like California, New Jersey and New York. With a slim House Republican majority, those voices could impact negotiations.

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While Trump enacted the $10,000 SALT cap in 2017, he  on the campaign trail last year, vowing to "get SALT back" if elected again. He has renewed calls for reform since being sworn into office.

Lawmakers have floated several updates, including a complete repeal, which seems unlikely with a and several competing priorities, experts say.

"It all has to come together in the context of the broader package," but a higher SALT deduction limit could be possible, said Garrett Watson, director of policy analysis at the Tax Foundation.

Here's who could be impacted.

How the SALT deduction works

When filing taxes, you choose the greater of the standard deduction or your itemized deductions, including SALT capped at $10,000, medical expenses above 7.5% of your adjusted gross income, and others.

Starting in 2018, the Tax Cuts and Jobs Act doubled the standard deduction, and it adjusts for inflation yearly. For 2025, the standard deduction is $15,000 for single filers and $30,000 for married couples filing jointly.

Because of the high threshold, the vast majority of filers — , according to the latest IRS data — use the standard deduction and don't benefit from itemized tax breaks.

Typically, itemized deductions increase with income, and higher earners tend to owe more in state income and property taxes, according to Watson.

Who benefits from a higher SALT limit

Generally, higher earners would benefit most from raising the SALT deduction limit, experts say.

For example, one proposal, which would remove the "" in federal income taxes, involves increasing the cap on the SALT deduction for married couples filing jointly from $10,000 to $20,000.

That would offer almost all the tax break to households per year, according to a January analysis from the Tax Policy Center.

"If you raise the cap, the people who benefit the most are going to be upper-middle income," said Howard Gleckman, senior fellow at the Urban-Brookings Tax Policy Center.

Of course, upper-middle income looks different depending on where you live, he said.

Forty of the impacted by the SALT limit are in California, Illinois, New Jersey or New York, a Bipartisan Policy Center analysis from before 2022 redistricting found.

If lawmakers repealed the cap completely, or more would see nearly three-quarters of the benefit, according to a separate Tax Policy Center analysis from September.