It’s worse than you fear. The amount you can use in calculating NIIT is limited to “deductions allowed by subtitle A” (see (a)(2) of the reg). That means the amount you can deduct in calculating regular income tax. You don’t deduct state income tax you pay after the end of the year in calculating regular income tax, so you can’t deduct it in calculating NIIT. What’s worse, you can’t deduct anything paid within the same year to the extent it exceeds the new $10,000 limit on SALT deduction. If you don’t itemize, it doesn’t include anything. The only good news is that if the amount that would be allocable to net investment income without regard to the $10,000 limit is $10,000 or more, the entire $10,000 you deduct for regular tax purposes (assuming you do so) can be deducted for NIIT purposes. In other words, you don’t have to allocate the deductible portion between investment income and other income.