New 'Salt Cap' raises tax deduction limits, offers significant savings through 2029


New 'Salt Cap' raises tax deduction limits, offers significant savings through 2029

It's thanks to something called the Salt Cap in President Trump's spending bill.

According to Liberty Tax, it allows you to itemize your deductions to deduct certain state and local taxes on your federal return.

Single filers can deduct up to $20,000 and people who are married filing jointly can deduct up to $40,000 in combined mortgage interest, real estate tax, and personal property taxes.

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If you are married, filing separately, the cap is $20,000.

"It's really nice to see the changes because people that in some instances would owe just a little bit every year, they're going to see a big change, and they're going to get a refund, so we love to see smiling faces leave the office," said Corporate Office Supervisor for Liberty Tax, Michelle Catron.

In order to use this, you must itemize your deductions.

It applies to state and local income taxes, real estate and property taxes and sales taxes as an alternative to income taxes.

According to Liberty Tax, this is expected to last through 2029.

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