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SALT Cap Calculator: $40,000 Limit and Phase-Down | HelloBooks Run the 2025 Schedule A SALT worksheet: $40,000 cap, 30% of MAGI over $500,000 off, never below $10,000. Shows the 2026 cap and floor too.

Calculator · Schedule A, line 5e

SALT cap phase-down calculator

For 2025 returns the calculator runs the State and Local Tax Deduction Worksheet from the Schedule A instructions, line by line. For 2026 it shows the published cap, threshold and floor, and gives a range when income is over the threshold, because the IRS has not yet published the 2026 worksheet.

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Taxes paid (line 5d)
$0
Phase-down reduction (30% of excess)
$0
Limit after reduction
$40,000
SALT deduction (line 5e)
$0

Taxes paid are at or under the floor, so no worksheet is needed. Estimate only.

How the calculation works

The calculator follows these steps from the IRS form or worksheet, in order.

  1. 2025, no worksheet needed if taxes paid (Schedule A line 5d) are $10,000 or less ($5,000 married filing separately).
  2. Line 1: $40,000. Line 4: MAGI (Form 1040 line 11b plus excluded foreign and Puerto Rico income).
  3. Line 5: $500,000 ($250,000 married filing separately). Line 6: line 4 minus line 5.
  4. Line 7: multiply line 6 by 30% (0.30). Line 8: line 1 minus line 7.
  5. Line 9: the larger of line 8 or $10,000. Line 10: the smaller of line 9 (half of it if married filing separately) or taxes paid.
  6. 2026: cap $40,400, reduced above $505,000 of MAGI but not below $10,000. The reduction rate for 2026 is not computed here.

Source: Instructions for Schedule A (2025); IRS correction to the 2026 Form 1040-ES (SALT). Checked on IRS.gov October 21, 2026.

Who should run the worksheet

Only itemizers with state and local taxes above the floor and MAGI above the threshold see a reduction. Under the threshold, the limit is the full cap. Far above it, the floor applies, so the planning range is the band in between.

Why 2026 shows a range

The IRS correction to the 2026 Form 1040-ES states the 2026 cap, threshold and floor but not how fast the cap shrinks. Until the 2026 Schedule A instructions are out, the tool shows the lowest and highest possible limit rather than guessing.

FAQ

Frequently asked questions

Does the phase-down ever take the limit below $10,000?
No. Line 9 of the 2025 worksheet sets the limit at the larger of the reduced cap or $10,000 ($5,000 after halving for married filing separately).
Do pass-through entity taxes count toward the cap?
An entity-level tax paid by a partnership or S corporation under a state election is deducted by the entity, not on the owner’s Schedule A, so it does not run through this worksheet. Check the state rules for each client.
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Sources

Estimates for tax professionals, not advice on a specific return. Figures and formulas are from IRS.gov on the date shown; confirm against the current form and instructions before filing.

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