SALT Cap Phase-Down Calculator 2026 ($500k+ AGI)
See how the $40,000 SALT cap shrinks for high earners above $500,000 of income.
SALT cap phase-down calculator
For 2026 the SALT (state and local tax) deduction cap is $40,000, but above $500,000 of modified adjusted gross income it phases down — reduced by 30% of the income over $500,000, never falling below the $10,000 floor. So the full $40,000 cap is gone by $600,000 MAGI. SALT only helps if you itemize. Enter your figures above to see your allowed cap.
The One Big Beautiful Bill Act raised the SALT deduction cap from $10,000 to $40,000 for 2025–2029 — a big win for itemizers in high-tax states. But for high earners the higher cap is clawed back: once modified adjusted gross income exceeds $500,000, the $40,000 cap is reduced by 30 cents for every dollar of income above that line.
The reduction stops at the old $10,000 floor, so even very high earners keep at least a $10,000 SALT deduction. The calculator above applies the phase-down and caps your deduction; remember SALT only matters if your total itemized deductions beat the standard deduction.
How the high-income phase-down works
Start with the $40,000 cap. Subtract 30% of the amount your MAGI exceeds $500,000. The result is your SALT cap for the year — but it never drops below $10,000. Because the reduction is 30%, the full $40,000 cap is fully phased down to the $10,000 floor once you are $100,000 over the threshold, i.e., at $600,000 MAGI.
| MAGI | Amount over $500k | 30% reduction | Your SALT cap |
|---|---|---|---|
| $500,000 | $0 | $0 | $40,000 |
| $540,000 | $40,000 | $12,000 | $28,000 |
| $570,000 | $70,000 | $21,000 | $19,000 |
| $600,000+ | $100,000+ | $30,000+ | $10,000 (floor) |
Only counts if you itemize
SALT is an itemized deduction on Schedule A. If your standard deduction ($16,100 single / $32,200 MFJ for 2026) is larger than your total itemized deductions, the SALT cap doesn't affect you. High earners who own homes in high-tax states are the ones most likely to itemize and hit the cap — and to see the phase-down bite.
Frequently asked questions
At what income does the SALT cap phase down?
Above $500,000 of modified adjusted gross income. The $40,000 cap is reduced by 30% of the income over $500,000, down to a $10,000 floor. The full reduction to $10,000 is reached at $600,000 MAGI.
Does the SALT cap ever go below $10,000?
No. Even for very high earners, the phase-down stops at the old $10,000 cap — that's the floor.
Do I have to itemize to use the SALT deduction?
Yes. SALT is claimed on Schedule A, so it only helps if your total itemized deductions exceed your standard deduction.
Is the $40,000 cap permanent?
No. It applies for tax years 2025 through 2029 and is scheduled to revert to $10,000 in 2030 unless Congress extends it.
IRS sources & verification
Last reviewed July 12, 2026.