In tax year 2024 (bills paid in 2025), 20.1% of Cook County homes with a homeowner exemption were billed more than $10,000 in property tax. For those owners, the bill alone used up the old federal limit on deducting state and local taxes, before a dollar of Illinois income tax.
That limit, known as the SALT cap, is now much higher. The 2025 federal tax law raised it to $40,000 for 2025 and $40,400 for 2026. It rises 1% a year through 2029, then falls back to $10,000 in 2030.
A higher cap only helps people who itemize. Here is who that is in Cook County, which year a property tax payment counts in, and what the IRS says about paying early in December.
Quick Answer
The SALT cap is $40,000 for 2025 and $40,400 for 2026 ($20,000 and $20,200 if married filing separately). It shrinks for incomes above $500,000 in 2025 and $505,000 in 2026, but never below $10,000, and it returns to $10,000 in 2030. Most Cook homeowners can now deduct all of their property tax and Illinois income tax. That helps only if those taxes, plus mortgage interest and gifts to charity, beat the standard deduction: $32,200 for married couples and $16,100 for single filers in 2026. Property tax counts in the year you pay it. A December prepayment counts for that year only if the tax was assessed by year end, and Cook's first-installment bill is an estimate.
The new limit, year by year
| Tax year | Cap | Married filing separately | Cap shrinks when income tops |
|---|---|---|---|
| 2025 | $40,000 | $20,000 | $500,000 |
| 2026 | $40,400 | $20,200 | $505,000 |
| 2027 to 2029 | 1% more each year | half the cap | 1% more each year |
| 2030 and later | $10,000 | $5,000 | no income test |
The income test uses modified adjusted gross income, and the threshold is half as much for married people filing separately. Above the threshold, the cap drops by 30 cents for each extra dollar of income, down to a floor of $10,000. In 2025, a household reaches that floor at $600,000 of income.
Who now benefits in Cook County
It takes two tests.
Test 1: Do your state and local taxes top $10,000? For most Cook homeowners that means property tax plus Illinois income tax, which is a flat 4.95%.
- In tax year 2024, the median Cook home with a homeowner exemption was billed $6,304. The median was $4,784 in Chicago and $7,042 in the suburbs.
- At that median bill, Illinois income tax pushes the total past $10,000 at about $75,000 of income taxed by Illinois.
- 20.1% of these homes had a bill over $10,000 on its own, and 7.3% topped $15,000.
- Only 0.4% had a bill over $40,000, the one group whose property tax alone tops the new cap.
Test 2: Do your itemized deductions beat the standard deduction? The standard deduction is $31,500 for married couples filing jointly in 2025 and $32,200 in 2026. For single filers it is $15,750 and $16,100. Heads of household get $23,625 and $24,150.
Three illustrative households under the 2026 rules:
| Single owner | Married couple, median bill | Married couple, higher bill | |
|---|---|---|---|
| Property tax | $9,000 | $6,304 | $12,000 |
| Illinois income tax at 4.95% | $4,455 (on $90,000) | $5,940 (on $120,000) | $9,900 (on $200,000) |
| SALT deduction under the old cap | $10,000 | $10,000 | $10,000 |
| SALT deduction for 2026 | $13,455 | $12,244 | $21,900 |
| Standard deduction for 2026 | $16,100 | $32,200 | $32,200 |
| Mortgage interest and gifts needed to itemize, old cap | $6,100 | $22,200 | $22,200 |
| Mortgage interest and gifts needed to itemize, 2026 | $2,645 | $19,956 | $10,300 |
What it shows: the higher cap matters most for single owners and for couples with bigger bills or incomes. A married couple with a median bill still needs nearly $20,000 of mortgage interest and gifts before itemizing beats the standard deduction.
The year a payment counts
Property tax counts in the year you pay it. If your mortgage company pays from escrow, the IRS says you count only what it actually paid to the county during the year.
Cook bills are paid a year behind. Both installments of one tax year are usually paid in the same calendar year, but not always:
| Bills paid | Tax year | First installment due | Second installment due |
|---|---|---|---|
| 2025 | 2024 | March 4, 2025 | December 15, 2025 |
| 2026 | 2025 | April 1, 2026 | October 1, 2026 |
Due dates move from year to year. When a second installment is due in December, paying it in January moves that payment to the next year's return.
Does paying in December help?
In recent years the Treasurer has let owners prepay the next year's first installment in December. Two facts matter before you do.
The first installment is an estimate. By law it is 55% of the prior year's total tax. The real tax for the year, with current values, exemptions and rates, is settled on the second installment.
The IRS counts a prepayment only if the tax was already assessed. Its Schedule A instructions say only taxes paid in a year and assessed before the next year can be deducted for that year. State or local law decides when a tax is assessed, which is generally when you become responsible for paying it. In December 2017, just before the old cap took effect, the IRS warned that prepaying taxes not yet assessed would not count for the year paid.
Whether a December payment toward Cook's estimated first installment counts as an assessed tax for that year is a question of Illinois law. Censum found no IRS guidance on Cook's first installment in particular. A tax preparer can confirm how this applies to your own return.
Lowering the bill beats deducting it
A deduction saves only your tax bracket's share of each dollar. In the 22% bracket, $1,000 of property tax deducted saves $220 of federal tax, and only if you itemize.
An exemption cuts the bill itself, whether you itemize or not. The homeowner exemption takes $10,000 off your equalized assessed value. At the median rate on Cook homes in tax year 2024, about 8.52%, that is roughly $852 a year. A successful assessment appeal works the same way.
Where Censum fits
At /exemptions you can check, for free, which exemptions are on your Cook County home, and Censum can prepare the Assessor's refund filing for exemptions missed in past years. At /win you can see your home's appeal odds and your township's open window. Tax preparers can read about Censum's program for sharing the free check with clients at /cpa-partners. Censum is not a tax advisor and does not prepare returns.
The numbers behind this article
- Bills: Censum's tabulation of PTAXSIM, the Cook County Assessor's Office research database, tax year 2024 (bills paid in 2025). It counts class 2 residential parcels with a homeowner exemption and a bill above $0, excluding co-op building parcels (class 2-13): 983,596 parcels. Chicago means the city's eight townships. The Assessor describes PTAXSIM results as not official.
- Rate: the median tax code rate across class 2 parcels with a homeowner exemption in tax year 2024 (8.523%).
- The $75,000 crossing point: ($10,000 minus the $6,304 median bill) divided by 4.95%.
- Examples: illustrative households. Illinois tax is 4.95% of the stated income taxed by Illinois. They leave out other state and local taxes and other itemized deductions.
- Federal amounts come from the IRS pages and the tax code section listed below.
FAQ
Does the higher cap apply to my 2025 return?
Yes. The cap is $40,000 for 2025, the return most people file in 2026, if your income is under the $500,000 threshold.
Does the cap go back down?
Yes. Under current law it returns to $10,000 for tax years beginning in 2030.
Why isn't my first-installment bill my real tax?
It is an estimate set by law at 55% of last year's total. The second installment settles the rest using the current year's values, exemptions and rates.
I pay through escrow. Which amount counts?
What your mortgage company actually paid to the county during the year, according to the IRS.
Do I have to itemize to get the new $6,000 senior deduction?
No. The IRS says the deduction for people 65 and older, available for 2025 through 2028, can be claimed whether or not you itemize.
What if I get a property tax refund?
The IRS says a refund of taxes you paid in the same year reduces that year's deduction. A refund of an earlier year's taxes may have to be reported as income if deducting those taxes lowered your tax back then.
Sources
- IRS, 2025 Instructions for Schedule A (Form 1040) (PDF): SALT limit, income threshold, worksheet, prepayment rule, escrow and refunds
- IRS, Correction to state and local income tax deduction amount in the 2026 Form 1040-ES
- IRS, Publication 505 (2026)
- IRS, One, Big, Beautiful Bill provisions for individuals and workers: standard deduction and senior deduction
- IRS, IR-2017-210, prepaid real property taxes (archival)
- 26 U.S.C. 164(b)(6) and (7): applicable limitation amount by year, phasedown and $10,000 floor
- Illinois Department of Revenue, income tax rates
- Cook County Treasurer, due dates
- Cook County Treasurer, early payment of first installment
- Cook County Treasurer release, December 2024, on prepaying taxes due in 2025 (PR Newswire)
- Cook County Board of Review, Frequently Asked Questions: first installment is 55% of the prior year's total
- Cook County Assessor, Homeowner Exemption
- Censum tabulation of PTAXSIM (Cook County Assessor's Office), tax year 2024.
Sources accessed November 11, 2026.
Next step
Before you count on a deduction, make sure the bill itself is right. Check my exemptions
Censum LLC is a data and analytics company, not a law firm and not a tax advisor. Censum is independent and is not affiliated with Cook County or any government agency.