Updated Instructions for Itemized Deductions on Federal Income Tax Returns

The Department of Revenue has updated the Form 2 instructions to provide guidance to taxpayers claiming itemized deductions on their federal income tax return that are affected by the state and local income tax cap (SALT cap). If a taxpayer’s deduction is limited to the SALT cap, the adjusted itemized deduction amount on Form 2, line 2 is reduced after considering all state and local taxes, other than state income tax.

Learn more about reporting the deduction and revised Worksheet A here.