Farm CPA Report

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Farm CPA Report
Get Ready for a 45.5% Tax Bracket

Get Ready for a 45.5% Tax Bracket

The SALT deduction has a rapid phase-out which can create a 45.5% tax rate for certain taxpayers

Paul Neiffer's avatar
Paul Neiffer
Jul 02, 2025
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Farm CPA Report
Farm CPA Report
Get Ready for a 45.5% Tax Bracket
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Photo by Michael Bourgault on Unsplash

Both the Senate and House state and local tax (SALT) proposals will allow most taxpayers to deduct up to $40,000 of SALT. However, as your income increases from $500,000 to $600,000 your SALT deduction limit will drop to $10,000.

This can lead to a top tax rate of 45.5% for single taxpayers and about 41.60% for most married couples.

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