HR 9626
To amend the Internal Revenue Code of 1986 to eliminate the State and local tax deduction marriage penalty.
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Bill overview
This bill aims to eliminate a tax penalty that affects married couples filing jointly. Specifically, it modifies the calculation of the state and local tax deduction allowed on tax returns. The changes increase the amount of the deduction available to married couples filing jointly and reduce it for those filing separately, based on a percentage of the joint return deduction. These adjustments are set to take effect starting in 2027.
Key provisions
- Increases the state and local tax deduction for married couples filing jointly.
- Reduces the state and local tax deduction for married individuals filing separately.
- The reduction for married individuals filing separately is 50% of the joint deduction.
- The changes are tied to the tax year 2026.
- Modifies the adjusted gross income threshold for the deduction.
- Includes conforming amendments to clarify the application of the changes.
- Eliminates a specific limitation amount for married individuals filing separately.
Who is affected
- Married couples
- Taxpayers filing jointly
- Taxpayers filing separately
- Individuals subject to state and local taxes
Notable changes
- Adjusts the calculation of the state and local tax deduction based on filing status.
- Creates a tiered deduction based on joint versus separate filings.
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Primary sponsor
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119th CONGRESS — 2d Session
H. R. 9626
IN THE HOUSE OF REPRESENTATIVES
A BILL
To amend the Internal Revenue Code of 1986 to eliminate the State and local tax deduction marriage penalty.
2026, $40,400,and inserting the following:
in the case of a joint return, 200 percent of the dollar amount under subclause (I), and
2026, $505,000, andand inserting the following:
in the case of a married individual filing a separate return, 50 percent of the dollar amount under subitem (aa), and
Subparagraphs (A)(iii) and (B)(ii)(III) of section 164(b)(7) of such Code are each amended—
by inserting with respect to the filling status of the taxpayer for the taxable year,
before 101 percent
, and
by inserting , with respect to such filing status,
after in effect
.
Section 164(b)(6)(B) of such Code is amended by striking (half the applicable limitation amount in the case of a married individual filing a separate return)
.
Section 164(b)(7)(A)(iv) of such Code is amended by inserting (half such amount in the case of a married individual filing a separate return)
.
(half the threshold amount in the case of a married individual filing a separate return).
The amendments made by this section shall apply to taxable years beginning after December 31, 2026.