With the passing of the One Big Beautiful Bill Act, the federal government decided to pass the SALT. And as a financial advisor in Lexington, Kentucky, I think this one has the potential to impact more households here than most people realize.

SALT stands for State and Local Taxes, and the cap on itemized SALT deductions just jumped from $10,000 to $40,000 starting in 2025. When you factor in Kentucky's state income tax, Lexington's local occupational tax, and Fayette County property taxes, that math changes for a lot of families in this area.

This is week two of our OBBBA series on The Groundwork.

WHAT YOU'LL LEARN

•      What SALT stands for and how the itemized deduction cap works

•      How the cap increased from $10,000 to $40,000 starting in 2025, increases 1% per year through 2029, then reverts to $10,000 in 2030

•      The income phase-out: the deduction gradually phases back to $10,000 for households earning $500,000 to $600,000

•      A Lexington-specific breakdown: how KY state income tax, Lexington's occupational tax, and Fayette County property taxes combine to affect local households

•      Why a household earning $115,000 to $120,000 in W2 income was already hitting the old $10,000 cap

•      Why this isn't just a provision for the ultra wealthy

•      How it takes roughly $600,000 in household income to fully use the $40,000 cap, right at the start of the phase-out

•      Why households earning $115,000 to $500,000 who own a home should take a second look

•      Why the new cap may make itemizing worthwhile again, especially combined with mortgage interest and charitable giving

Not sure whether this changes anything for your tax strategy? That's a good question to bring into a conversation.

If you're a homeowner in Lexington, Central Kentucky, or anywhere across the Bluegrass, and you want to know whether the SALT deduction change affects your financial picture or plan, I'd be glad and honored to sit down with you and walk through it.