Gottheimer’s SALT Bill Would Double Couples’ Deduction Cap

Card photograph: ARCHIVE. Josh Gottheimer and Hakeem Jeffries during a congressional delegation to Israel, 2023-04-24. Office of Rep. Josh Gottheimer; individual photographer not identified, Public domain, U.S. federal government work. Cropped for the card. License. Source photograph.

Josh Gottheimer proposed doubling the state-and-local-tax deduction cap for married couples filing jointly, using $80,800 rather than $40,400 as the 2026 base. His April 14 announcement presented the idea as relief for New Jersey families; the bill introduced in July would take effect for tax years beginning in 2027.

The formal H.R. 9626 text introduced July 9 would double both the joint-return ceiling and the income threshold at which it phases down. It uses the 2026 dollar amounts as the base for subsequent adjustments, but specifies an effective date for tax years beginning after December 31, 2026. The April announcement’s $80,800 figure should therefore not be read as an enacted change for 2026 returns.

A deduction reduces taxable income; it is not an $80,800 payment, nor a dollar-for-dollar tax credit. A higher ceiling helps a household only when its deductible taxes, itemizing decision and other applicable limits make the extra deduction usable. Workers who take the standard deduction would not receive a SALT deduction from this change. That mechanism differs from Amy Acton’s proposed Ohio child tax credit, which uses a credit rather than a deduction to deliver household relief.

A temporary ceiling, a distributional choice

Josh Gottheimer, official congressional portrait, 2017. Kristie Boyd / U.S. House Office of Photography Source photograph. Public domain. License.

The Congressional Research Service’s account of the 2025 tax law explains that Congress raised the cap to $40,000 for 2025, provided annual increases through 2029 and scheduled a return to $10,000 in 2030. Gottheimer’s proposal would change the treatment of married couples within that wider tax structure.

The marriage-penalty argument concerns whether two taxpayers should share one ceiling. The wider distributional choice concerns which households can claim the relief. Gottheimer’s bill would increase a deduction available to qualifying itemizers while leaving the standard deduction outside that mechanism.

An income phaseout remains part of the law

CRS describes another limit beyond the headline ceiling. Under the 2025 law, the enlarged cap phases down by 30% of modified adjusted gross income above $500,000 for 2025, with that threshold increasing annually. The deduction floor remains $10,000. A larger nominal ceiling therefore does not mean every high-income household receives the full amount.

Consider an illustrative couple with $60,000 in eligible state and local taxes, sufficient income-tax liability and no applicable phaseout. A $40,400 ceiling leaves $19,600 of those taxes outside the deduction. An $80,800 ceiling would accommodate the full $60,000. The extra $19,600 would reduce taxable income, not the tax bill by $19,600; the eventual saving depends on the household’s tax circumstances.

That example also shows why the policy differs from a renter credit or direct housing subsidy. The route to assistance is having eligible taxes to deduct. A household facing a severe rent burden but taking the standard deduction does not become eligible simply because its costs are high.