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ARTICLE · 10 SEPTEMBER 2025

The One Big Beautiful Bill Act Analysis Series: An Update On Changes To Itemized Deductions

Reinhart, Boerner, Van Deuren SC
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Since our prior installment in the One Big Beautiful Bill Act Analysis Series was published just days after the One Big Beautiful Bill Act (OBBBA) was signed into law, there have been noteworthy updates...

United StatesTax
Nicholas Smith
Nicholas Smith
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Since our prior installment in the One Big Beautiful Bill Act Analysis Series was published just days after the One Big Beautiful Bill Act (OBBBA) was signed into law, there have been noteworthy updates to the OBBBA's changes that affect individual taxpayers and their estate planning. In this alert, we provide a summary of notable changes, including analysis and key details regarding state and local tax (SALT) and charitable deductions, as well as the new "2/37 reduction" of itemized deductions for taxpayers in the highest income bracket.

SALT Deduction

The SALT deduction allows taxpayers to deduct certain state and local taxes from their federal income taxes. Taxes that qualify for the SALT deduction include state and local income taxes, real estate taxes and certain personal property taxes. The OBBBA raised the cap on SALT deductions from $10,000 to $40,000, with the cap scheduled to increase by 1 percent annually from 2026 through 2029. The cap will then

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