The State and Local Tax (SALT) deduction allows taxpayers to deduct state and local taxes from their federal taxable income. A $10,000 cap was placed on this deduction in 2017 through the Tax Cuts and Jobs Act, causing increased conflict between legislators in recent years. This limit especially impacts residents in states with higher taxes because they can no longer deduct as much from their federal returns, potentially resulting in higher federal taxes. Currently, Congress is deeply divided on whether to raise this cap—some lawmakers propose increasing the limit to as much as $40,000, while others prefer a lower compromise of $30,000. With rising home costs, higher wages, and continuing inflation pressures across the country, the final decision over the SALT cap could significantly affect many households' finances.