Resilient Asset Management

If you live in a high-tax state, this is the most important tax planning opportunity of the next several years.

The SALT deduction cap — the limit on how much of your state and local taxes you can deduct federally — quadrupled starting in 2025 and remains elevated for 2026.

2024 cap: $10,000
2026 cap: $40,400

For households in New York, New Jersey, California, or Connecticut paying $20,000, $25,000, or more in state and local taxes annually, this changes the itemizing math entirely.

A few details worth knowing as you plan for this tax year:

• The $40,400 cap phases down for income above $500,000 MAGI
• It increases 1% annually through 2029
• It reverts to $10,000 in 2030 — this window is finite

Now is also the right time to revisit whether itemizing makes sense for your situation. The elevated SALT cap, combined with mortgage interest and charitable deductions, may tip the scales for households that have defaulted to the standard deduction for years.

Four years sounds like plenty of time. It isn't. The planning decisions you make now determine what you capture from this window.