To amend the Internal Revenue Code of 1986 to eliminate the State and local tax deduction marriage penalty.

Bill Number

H.R. 9626

Origin Chamber

House

Congress

119th Congress, Session 2

Status

Introduced

Latest Action

2026-07-09: Referred to the House Committee on Ways and Means.

Last Updated

2026-07-10T12:48:40Z

AI-Generated Summary

Purpose

The legislation amends the Internal Revenue Code to remove a marriage penalty in the State and local tax (SALT) deduction limits. It adjusts deduction caps and income thresholds so that married couples filing jointly receive limits twice as high as single filers, while married individuals filing separately receive half the single filer amount.

Key Provisions

• SALT Deduction Cap Adjustment: Modifies section 164(b)(7)(A)(ii) to set the base limit at $40,400 for most filers, with 200 percent ($80,800) for joint returns and 50 percent for married filing separately.
• Modified Adjusted Gross Income Threshold: Updates section 164(b)(7)(B)(ii)(II) to apply the same filing-status-based scaling to the $505,000 income threshold.
• Conforming Changes: Revises related subsections to incorporate filing status considerations, including adjustments to phaseout calculations and separate return rules.
• Effective Date: Applies to tax years beginning after December 31, 2026.

Significant Changes to Existing Law

• Replaces a uniform dollar limit (previously not scaled by filing status) with status-specific amounts, directly addressing the marriage penalty where joint filers previously faced the same cap as singles despite combined incomes.
• Introduces explicit doubling for joint returns and halving for separate returns in both the deduction cap and income threshold.
• Removes prior references to half-amount rules for separate filers in certain subsections, streamlining them with the new structure.

Potential Impacts

• On Citizens: Married couples, particularly in high-tax states, could claim larger SALT deductions, potentially lowering their federal tax liability.
• On Government Agencies: The Internal Revenue Service would need to update tax forms, guidance, and processing systems to reflect the new filing-status rules; this may increase administrative complexity in the short term.
• On International Relations: No direct effects identified.

Main Stakeholders Affected

• Taxpayers who itemize deductions and pay significant state and local taxes, especially married couples.
• The Internal Revenue Service, responsible for implementing and enforcing the revised rules.
• Members of Congress and tax policy analysts focused on deduction fairness.

Notable Legal, Constitutional, or Political Implications

• The changes promote equal treatment based on marital filing status without altering the underlying constitutional authority for federal tax deductions.
• No apparent conflicts with existing constitutional provisions on taxation or equal protection.
• The bill focuses solely on technical adjustments to the tax code, with no broader political or international dimensions noted in the text.

This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.

Sponsor

Rep. Gottheimer, Josh [D-NJ-5]

Recent Actions

• 2026-07-09: Referred to the House Committee on Ways and Means.
• 2026-07-09: Introduced in House
• 2026-07-09: Introduced in House

Bill Versions

• To amend the Internal Revenue Code of 1986 to eliminate the State and local tax deduction marriage penalty. — issued 2026-07-09 — PDF (3 pages)