H.R. 9626: To amend the Internal Revenue Code of 1986 to eliminate the State and local tax deduction marriage penalty.

This bill would change how the federal state and local tax deduction (often called the SALT deduction) works for married taxpayers.

What the SALT deduction is

The SALT deduction lets taxpayers who itemize deduct certain state and local taxes, such as:

• state and local income taxes, or
• state and local sales taxes, and
• property taxes,

up to a federal limit.

What this bill changes

Under current law, the SALT deduction limit is not the same for all filing statuses. This bill would revise the rules so that:

• Married couples filing jointly would get a deduction cap equal to 200% of the single filer cap.
• Married people filing separately would get a cap equal to 50% of the single filer cap.
• The bill also makes related wording changes in the tax code so the limits are tied more clearly to a taxpayer’s filing status.

Why it is called a “marriage penalty” fix

The bill’s title says it would eliminate the “marriage penalty” in the SALT deduction. In plain terms, that means it aims to make the deduction rules more proportional for married taxpayers, rather than treating them in a way that the sponsors view as unfair compared with single filers.

When it would take effect

The changes would apply to taxable years beginning after December 31, 2026. In practice, that means the new rules would first affect returns filed for the 2027 tax year and later, if enacted.

Practical effect

If enacted, the bill would mainly affect taxpayers who:

• itemize deductions,
• pay significant state and local taxes, and
• are married, especially those filing jointly or separately.

It would not create a new deduction; instead, it would change the amount married taxpayers can deduct under the existing SALT rules.

Relevant Companies

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