President Donald Trump’s Big Beautiful Bill that passed in Congress in July 2025 included a provision to raise the state and local tax (SALT) deduction cap to $40,000 from the previous $10,000. “An additional $30,000 in deductions could amount to about $10,500 in annual tax savings for such homeowners, assuming a 35% federal marginal tax rate,” Realtor.com senior economist Jake Kimmel said in an email.
Realtor.com broke down the 10 states and 10 metropolitan areas with the highest percentage of properties with taxes over $10,000, that stand to really benefit from the SALT cap increase.
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NJ | 39.9% |
NY | 25.9% |
CT | 19.4% |
CA | 19.3% |
MA | 18.4% |
NH | 16.3% |
DC | 15.6% |
IL | 13.7% |
TX | 12.4% |
RI | 9.3% |
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San Jose-Sunnyvale-Santa Clara, CA | 47.9% |
New York-Newark-Jersey City, NY-NJ | 47.8% |
San Francisco-Oakland-Fremont, CA | 40.9% |
Bridgeport-Stamford-Danbury, CT | 39.3% |
Kiryas Joel-Poughkeepsie-Newburgh, NY | 37.5% |
Trenton-Princeton, NJ | 35.8% |
Nantucket, MA | 35.5% |
Austin-Round Rock-San Marcos, TX | 32.0% |
Jackson, WY-ID | 28.7% |
Santa Cruz-Watsonville, CA | 28.1% |
Presumably, these areas will benefit the most from the SALT deduction cap increase. “The winners of this deduction will most definitely be the middle- to upper-middle-class earners of high-tax states,” said Tasha Preisner, managing partner at DeMar Consulting Group.
But, even if you fall into this category, there are important considerations before you jump to begin itemizing deductions again.
The Big Beautiful Bill also brings about an increase in the standard deduction up to $15,750 for single taxpayers and $31,500 for joint filers. This is still less than the SALT cap, which means it might make sense for some taxpayers to itemize in 2025.
“Many homeowners stopped itemizing their taxes after the 2017 TCJA [was introduced] … and the standard deduction was expanded, giving little incentive for itemization,” Preisner said. “These homeowners will likely start itemizing again.”
But itemizing requires careful tax prep, saving receipts and potentially seeking the help of experts. “More taxpayers will be turning to professionals to help them with their tax planning and tax preparation rather than doing it themselves,” Preisner predicted.
