Self-Employed SALT Cap Calculator
Enter your MAGI and total state + local taxes below. The estimate applies the OBBBA cap and phase-out line by line — no tax software, no signup.
The short answer: Jo — at the scenario numbers pre-loaded below, the OBBBA deduction is $3,000, worth about $660 in federal income tax at a 22% marginal rate ($25 per biweekly paycheck). Exact figures update live as you change the inputs.
⚠️ This calculator provides estimates for informational and educational purposes only. It is not tax advice. Results are based on the One Big Beautiful Bill Act (OBBBA) and IRS Schedule 1-A. Consult a qualified tax professional for your specific situation.
Your State's Slice of the $40,000 Cap
The deduction mechanics surprise every freelancer: the employer-equivalent half of self-employment state tax is deducted on Schedule C as a business expense, and only the remaining personally-paid tax tests the SALT cap. That split effectively shelters part of your state tax outside the cap entirely — one of the few genuinely favorable interactions in the code for 1099 workers who otherwise miss the OT/tips lines.
The full rules, caps and phase-outs for every deduction are in one table on the OBBBA rules page.
Worked Example
Jo nets $95,000 freelancing and pays $13,000 of state tax, half through the business.
- • Deductible amount: $3,000
- • Federal income tax savings: $660 (at the 22% marginal rate)
- • Per biweekly paycheck: $25
Your actual state tax bill sets the input; the cap and phase-out above set the ceiling — the calculator reconciles both.
Keep Reading
- • /salt-cap/
- • /rules/
- • /faq/
Frequently Asked Questions
Does half my state tax skip the SALT cap as a business expense?
Yes — the employer-equivalent portion of state income tax on self-employment earnings is a Schedule C business deduction that never tests the SALT cap. Only the personal remainder counts against the $40,000.
Which taxes count toward the SALT deduction?
State and local income taxes (or sales tax if you elect that instead) plus real property taxes, up to the OBBBA cap after any income phase-out. Federal taxes never count.