Florida’s lack of a state income tax has long made it a haven for taxpayers, but that doesn’t mean residents have been immune to the impact of the federal SALT deduction cap. With property values—and local taxes—rising across many parts of the state, a higher federal limit could offer a meaningful reprieve.

Under the old $10,000 SALT deduction cap, 5.4% of Florida homeowners exceeded the threshold. With the new $40,000 cap, that number drops sharply to just 0.4%, according to Realtor.com® economists. That shift is expected to provide direct relief to households in high-tax areas like South Florida.

“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”.