Question

People are often talking about the "SALT" deduction. What do they mean and what is the current issue?

Answer 1

SALT deduction means State And Local Tax deduction.

it is an itemized deduction as opposed to standard deduction

this is preferred by high income tax payers from high tax states such as New York, California, New Jersey etc as for them itemized deductions are greater than standard deduction. These taxpayers deduct local tax payments on their federal tax returns so that there income tax liability is low.

Option for SALT deduction is useful only if your itemized deductions are greater than standard deduction.