Californians have long carried some of the nation’s heaviest tax burdens, with many homeowners squeezed by the $10,000 cap on state and local tax (SALT) deductions. But with Congress approving a $40,000 cap, a significant portion of the state’s homeowners stand to gain meaningful financial relief.

Under the previous cap, 20.2% of California homeowners were unable to deduct their full property tax burden. That share will now drop to just 1.8% with the expanded limit in place. Cities like San Jose and San Francisco—where over 40% of households pay more than $10,000 in property taxes—will feel the biggest impact.

“Residents of high-tax states suffered the most with the previous cap on state and local taxes,” says Colin Allen, executive director of the American Property Owners Alliance. “Because their taxes far exceeded the cap, they were not able to deduct the full amount like residents in low-tax states”.