Tax
SALT Cap
The $10,000 federal cap on the deduction for state and local taxes paid by individuals.
The SALT cap was introduced by the 2017 Tax Cuts and Jobs Act, limiting the federal itemized deduction for state and local taxes (income, property, sales) to $10,000 per year — a major hit for high-tax-state residents.
States have responded with PTET (pass-through entity tax) workarounds that move state tax payment to the entity level, where it remains federally deductible. Most high-tax states now have a PTET.
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