A $40,400 limit, $20,200 for married filing separately
The overall limit on the deduction for state and local income, sales and property taxes is $40,400 for 2026, halved to $20,200 if you file married separately. IRS Publication 505 (2026) states the limit directly, and the page applies it before anything else.
The cap covers the combination of those taxes, not each one. A filer with $25,000 of state income tax and $20,000 of property tax still deducts at most $40,400, not $45,000, which is the mistake a per-tax reading of the rule invites.
The status selector has only two choices - the standard set of filing statuses, or married filing separately - because those two values are the only ones the limitation distinguishes. Joint filers with two earners share one cap; the limit is per return, so it does not double when a second income appears on the return.
What counts toward the cap
State and local income taxes paid or withheld during the year count toward the limit. So does general sales tax taken instead of the income tax, and so do real estate taxes on property you own. The sales-tax option is a choice made per return: you take the larger of the two, not both, and the total stays under the same cap either way.
Foreign taxes are not part of this deduction. They are handled through the separate foreign tax credit, which has its own rules and limits, and none of that touches the SALT worksheet. The income line the worksheet uses is modified adjusted gross income, which is why the page asks for it separately rather than deriving it from the tax paid.
The page takes one combined figure for the taxes you paid. If you are choosing between income tax and general sales tax, work out which is larger before entering it, because the calculator cannot compare the two for you and entering both would double the base before the cap even applied.
The MAGI reduction for high earners
When modified adjusted gross income exceeds $505,000 ($252,500 if married filing separately), the cap is reduced by 30% of the excess, rounded to whole dollars, but never below $10,000 ($5,000 married filing separately). Below the threshold the full cap applies untouched.
The table shows the arithmetic in order: the cap for your status, the MAGI reduction as a negative line, the limit after that reduction, and the deduction you can actually claim. The reduction line is printed even when the floor has taken over, so a large number there does not mean the limit went below the floor - the fourth row is the one that settles it.
The default case, $60,000 of taxes at $200,000 of MAGI, deducts the full $40,400. At $550,000 the excess is $45,000, the reduction is $13,500 and the limit falls to $26,900. At $700,000 the reduction would be $58,500, which would take the limit to -$18,100; the floor stops it at $10,000 instead.
Only worth it if you itemize
The SALT deduction exists only on Schedule A, so it is worth something precisely when your itemized deductions as a whole beat the standard deduction. A household that takes the standard deduction collects nothing from this line, no matter how much state and local tax it paid.
That is why the page reports a deductible amount rather than a tax saving. The figure it prints is the amount that can appear on Schedule A; converting that into dollars saved requires the rest of the return, including the standard-versus-itemized comparison, which the related calculator handles line by line.
Do not read the deduction as a refund or as an extra payment. It reduces the income the federal return is taxed on, and its value depends on your bracket. An estimate, not a return, and not tax advice.
Danfio