2023 SALT Deduction Limit
The 2023 SALT Deduction Limit is $10,000.
Effective 2023-01-01Source: 2023 Instructions for Schedule A (Form 1040) (IRS)Verified 2026-08-30
Compared with 2022
Every figure on this page is unchanged from 2022.
| Item | 2022 | 2023 | Change |
|---|---|---|---|
| Deduction limit | $10,000 | $10,000 | +$0 (+0.0%) |
Who it applies to
Taxpayers who itemize deductions on Schedule A and claim state and local taxes
What changed this year, and why
For 2023, the deduction for state and local taxes (SALT) is limited to $10,000. Married taxpayers filing separately have a lower limit. The source document identifies these taxes on Schedule A, lines 5a, 5b, and 5c.
Common questions
- Which taxes are subject to the SALT deduction limit?
- The limit covers state and local income taxes (or sales taxes), real estate taxes, and personal property taxes reported on Schedule A, lines 5a, 5b, and 5c.
The limit shrinks above a stated income
For the 2023 tax year, the federal SALT deduction limit is $10,000. However, this limit is not simply subtracted from your total state and local taxes—it applies only to the subset of taxes that qualify, and even then the $10,000 cap is the maximum you can claim regardless of how much you actually paid. The limit is not phased down based on income; it remains a flat $10,000 ceiling for all taxpayers who itemize, whether they file as single, head of household, or married filing jointly. (Married filing separately taxpayers are subject to the same $10,000 limit.) The $10,000 cap will not be reduced below that amount by any income-based formula in 2023. To benefit from the SALT deduction at all, you must forgo the standard deduction and itemize your deductions on Schedule A. If your total itemized deductions—including SALT—do not exceed your standard deduction, the SALT limit has no practical effect on your return.
You can elect to deduct state and local general sales taxes instead of state and local in- come taxes. You can't deduct both.
2023 Instructions for Schedule A (Form 1040) (IRS)
Income taxes or sales taxes, one or the other
The IRS allows taxpayers to deduct either state and local income taxes or state and local general sales taxes on Schedule A, but not both in the same tax year. This election applies to the 2023 tax year for those who choose to itemize their deductions rather than take the standard deduction. If you do not elect to deduct general sales taxes, you include your state and local income taxes on line 5a. The choice between the two depends on which category of taxes you paid more of during the year. Regardless of which option you select, the total SALT deduction you claim on your federal return is subject to the $10,000 limit. This cap applies to the combined total of all state and local taxes you deduct, whether you choose the income tax path or the sales tax path. Taxpayers in states with no income tax typically benefit from electing the sales tax deduction, while those in high-income-tax states usually find the income tax deduction more advantageous, up to the $10,000 ceiling.
You can elect to deduct state and local general sales taxes instead of state and local in- come taxes. You can't deduct both.
2023 Instructions for Schedule A (Form 1040) (IRS)
What is not a deductible tax
The IRS specifies certain taxes that taxpayers cannot deduct on Schedule A for 2023. Federal income taxes and most excise taxes are never deductible as itemized deductions. Social security, Medicare, federal unemployment (FUTA), and railroad retirement (RRTA) taxes also cannot be deducted. Customs duties and federal estate and gift taxes are similarly nondeductible. Among state and local taxes, gasoline taxes, car inspection fees, assessments for sidewalks or other property improvements, license fees (such as marriage, driver's, or pet licenses), and taxes paid on behalf of someone else cannot be deducted. Foreign personal or real property taxes are also excluded from the SALT deduction. Even if you paid these taxes during 2023, they do not count toward your $10,000 SALT deduction limit and cannot be claimed as itemized deductions. Only qualifying state and local income taxes, property taxes, or general sales taxes count toward the deduction, and even those are subject to the $10,000 cap.
Taxes You Can't Deduct • Federal income and most excise taxes. • Social security, Medicare, federal unemployment (FUTA), and railroad re- tirement (RRTA) taxes. • Customs duties. • Federal estate and gift taxes. How- ever, see Line 16, later, if you had in- come in respect of a decedent. • Certain state and local taxes, in- cluding tax on gasoline, car inspection fees, assessments for sidewalks or other improvements to your property, tax you paid for someone else, and license fees (for example, marriage, driver's, and pet). • Foreign personal or real property taxes.
2023 Instructions for Schedule A (Form 1040) (IRS)
Payroll contributions that do count
Certain mandatory payroll contributions to state benefit funds count as deductible state and local taxes for 2023. If you are employed in California, New Jersey, or New York, mandatory contributions you made to the Nonoccupational Disability Benefit Fund are deductible on Schedule A. Similarly, mandatory contributions to the Rhode Island Temporary Disability Benefit Fund or the Washington State Supplemental Workmen's Compensation Fund qualify. Mandatory contributions to the Alaska, California, New Jersey, or Pennsylvania state unemployment funds also count. Additionally, mandatory contributions to state family leave programs, such as the New Jersey Family Leave Insurance program or the California Paid Family Leave program, are deductible. These payroll deductions from your wages are treated as state and local taxes and count toward your $10,000 SALT deduction limit. Unlike federal payroll taxes such as Social Security and Medicare, which cannot be deducted, these state-mandated contributions are specifically allowed as itemized deductions subject to the overall $10,000 cap.
Mandatory contributions you made to the California, New Jersey, or New York Nonoccupational Disability Bene- fit Fund, Rhode Island Temporary Disa- bility Benefit Fund, or Washington State Supplemental Workmen's Compensation Fund. • Mandatory contributions to the Alaska, California, New Jersey, or Penn- sylvania state unemployment fund. • Mandatory contributions to state family leave programs, such as the New Jersey Family Leave Insurance (FLI) program and the California Paid Family Leave program.
2023 Instructions for Schedule A (Form 1040) (IRS)
You only get this if you itemize
For 2023, you can only claim the SALT deduction if you itemize your deductions on Schedule A. The IRS instructions state that your federal income tax will generally be lower if you take the larger of your itemized deductions or your standard deduction. This means the SALT deduction is not an automatic benefit—it only reduces your tax liability if your total itemized deductions exceed your standard deduction. If your standard deduction is larger, you would be better off taking it rather than itemizing, and the SALT deduction becomes irrelevant to your return. The SALT deduction limit of $10,000 applies only to those who choose to itemize. You cannot claim both the standard deduction and any itemized deductions, including SALT. Before deciding whether to itemize, add up all your potential itemized deductions—state and local taxes, mortgage interest, charitable contributions, medical expenses above the threshold—and compare the total to your standard deduction to determine which option gives you the greater tax benefit.
Use Schedule A (Form 1040) to figure your itemized deductions. In most cases, your federal income tax will be less if you take the larger of your itemized deductions or your standard deduction.
2023 Instructions for Schedule A (Form 1040) (IRS)
How each figure was verified
Each number below was read from a stored copy of the document named beside it, and checked to occur word for word in the quoted sentence. The digest is of that stored text.
2023 Instructions for Schedule A (Form 1040) (IRS)
- Deduction limit
The deduction for state and local taxes is generally limited to $10,000 ($5,000 if married filing separately).