Any filter applied to a Smart Object is a Smart Filter. Smart Filters appear in the Layers palette below the Smart Object layer to which they are applied. Because you can adjust, remove, or hide Smart Filters, they are nondestructive.
You can apply any Photoshop filter—except for Extract, Liquify, Pattern Maker, and Vanishing Point—as a Smart Filter. In addition, you can apply the Shadow/Highlight and Variations adjustments as Smart Filters.
To work with Smart Filters, select a Smart Object layer, choose a filter, and then set filter options. After you apply a Smart Filter, you can adjust, reorder, or delete it.
To expand or collapse the view of Smart Filters, click the triangle next to the Smart Filter icon, displayed to the right of the Smart Object layer in the Layers palette. (This technique also shows or hides Layer Styles.) Or, choose Layers Palette Options from the Layers palette menu, then select Expand New Effects in the dialog box.
For a video on smart filters, see www.adobe.com/go/vid0004.