Tax tip: 2025 SALT tax deduction

Summary

CNBC’s Sharon Epperson explains the 2025 change to the state and local tax deduction. The itemized deduction cap rises to $40,000 from $10,000, but the benefit is reduced for incomes between $500,000 and $600,000, potentially creating a much higher tax rate for affected taxpayers.

• The 2025 SALT deduction cap is $40,000 for itemizers.
• The 2024 cap was $10,000.
• The benefit begins to phase down for incomes between $500,000 and $600,000.
• The phaseout can produce a much higher effective tax rate.
• The segment is a personal tax-planning tip, not an investment recommendation.