Which deduction should I choose, state and local income tax or sales tax?

For most people who itemize, the state and local income tax deduction gives them a bigger tax break. However, the sales tax deduction may be more advantageous for taxpayers who:

• Are residents of Alaska, Florida, Nevada, South Dakota, Texas, Washington, or Wyoming
• Made a major purchase and therefore paid a lot of sales tax
• Made frequent or substantial purchases in a state with high sales taxes

We’ll figure this out for you in Deductions & Credits and let you know which deduction saves you the most money based on your situation.

How this deduction changed starting in 2018

The SALT deduction (which is either state/local income tax plus property tax OR sales tax plus property tax) is capped at $5,000 for married couples filing separately and $10,000 for all other filers. In 2017 and earlier, there was no cap.

Here's an example that compares the changes:

Taxpayers must still itemize to get this deduction—that part hasn't changed.