How many people claim the state and local tax (SALT) deduction?
The TCJA imposed a $10,000 SALT cap and increased the standard deduction; the OBBBA later raised the cap to $40,000.
One of the largest itemized deductions in the tax code is the State and Local Tax (SALT) deduction. It allows taxpayers to reduce their federally taxable income by the amount they pay in state and local taxes, including property and income or sales taxes (but not both income and sales taxes). The Tax Cuts and Jobs Act of 2017 (TCJA) introduced a first-ever cap ($10,000) on the total amount of state and local taxes taxpayers can deduct from their taxable income, while also nearly doubling the standard deduction. These changes were followed by a decline in the portion of tax returns claiming the SALT deduction and the average sizes of those deductions themselves.
The $10,000 SALT cap had been scheduled to be lifted at the end of 2025. The recently enacted One Big Beautiful Bill Act (OBBBA) instead retained a SALT deduction cap but increased it to $40,000 starting in 2025. OBBBA also scheduled the cap to increase by 1% each year until permanently reverting to $10,000 starting in 2030.
Data summary
- The Tax Cuts and Jobs Act of 2017 (TCJA) introduced a $10,000 cap on the State and Local Tax (SALT) deduction while also nearly doubling the standard deduction. While that SALT cap and increased standard deduction were scheduled to sunset at the end of 2025, the recently enacted One Big Beautiful Bill Act (OBBBA) temporarily raised the cap to $40,000 and slightly increased the standard deduction further.
- After TCJA’s enactment, the portion of individual tax returns claiming the SALT deduction declined from 30.4% in 2017 to 9.3% in 2022, closely tracking the overall decline in the percent of returns opting to claim any itemized deduction.
- The average SALT deduction fell from $13,457 to $8,303. The aggregate dollar amount of SALT deductions claimed as a percentage of all itemized deductions claimed declined from 44.6% to 18.7%.
- Among people making over $1 million per year, the average SALT deduction declined from $282,402 in 2017 to $11,233 in 2022. (The average remained above $10,000 in 2022 because the most relevant data available includes some state and local taxes not subject to the cap). Additionally, the SALT deduction as a percentage of the aggregate dollars of itemized deductions claimed by those taxpayers fell from 60.5% to 3.9%.
- Claimed SALT deductions declined the most in high-income, high-tax states. For example, 35.3% of 2017 tax returns from New York (which has the highest state personal income taxes) claimed SALT for an average deduction of $23,804. By 2022, only 10.2% of federal returns from New York claimed the deduction, with the average being $9,417.
Keep exploring
- The State and Local Tax (SALT) deduction cap: explained - SALT deductions are mostly claimed by those making $100,000 or more. How does the cap work?
- How has TCJA impacted individual income taxes? - In 2025, the One Big Beautiful Bill Act expanded or made parts of the Tax Cuts and Jobs Act permanent. Here's how the TCJA has affected taxes since 2018.
- All about taxes - The One Big Beautiful Bill Act (OBBBA) came with some big tax changes. When do they take effect and what's the tax story so far? Here's your one stop shop for everything taxes.
- Who doesn’t pay federal income taxes? - Whether someone owes federal income tax depends on their income, deductions, and credits. In 2023, 3 in 10 filers owed nothing.