1. Standard Deduction Increases
The standard deduction—the amount you can subtract from your income before taxes are applied—has been raised across all filing statuses.
| Filing Status |
2025 (OBBB) |
2026 (New) |
| Married Filing Jointly |
$31,500 |
$32,200 |
| Head of Household |
$23,625 |
$24,150 |
| Single / Married Filing Separately |
$15,750 |
$16,100 |
2. 2026 Marginal Tax Brackets
For 2026, the tax rates remain the same, but the income thresholds have shifted upward to account for inflation.
- 37%: Incomes over $640,600 (Single) / $768,700 (Joint)
- 35%: Incomes over $256,225 (Single) / $512,450 (Joint)
- 32%: Incomes over $201,775 (Single) / $403,550 (Joint)
- 24%: Incomes over $105,700 (Single) / $211,400 (Joint)
- 22%: Incomes over $50,400 (Single) / $100,800 (Joint)
- 12%: Incomes over $12,400 (Single) / $24,800 (Joint)
- 10%: Incomes $12,400 or less (Single) / $24,800 or less (Joint)
3. Key Credits & Exemptions
The OBBB has introduced or enhanced several major tax benefits for families and employers.
Family & Individual Credits
- Adoption Credit: The maximum credit rises to $17,670, with a refundable portion of $5,120.
- Earned Income Tax Credit (EITC): The maximum amount for taxpayers with 3+ children is now $8,231.
- Estate Tax Exclusion: The basic exclusion amount for 2026 deaths is $15,000,000 (up from $13.99M).
- Gift Exclusion: Remains at $19,000 per recipient, though the exclusion for non-citizen spouses jumps to $194,000.
Employer & Employee Benefits
- Childcare Tax Credit: Employers can now claim up to $500,000 ($600,000 for small businesses) for providing childcare.
- Health FSA: The salary reduction limit is now $3,400, with a $680 carryover limit.
- Transportation Fringe: Monthly limits for transit and parking increase to $340.
4. What Isn't Changing?
- Personal Exemptions: These remain at 0.
- Itemized Deduction Limit: The "Pease" limitation remains permanently eliminated by the OBBB, though the tax benefit is capped for those in the 37% bracket.
- Lifetime Learning Credit: The phase-out range remains fixed at $80,000–$90,000 (Single) and $160,000–$180,000 (Joint).
Note on AMT: The Alternative Minimum Tax exemption for 2026 is $90,100 for individuals (phasing out at $500k) and $140,200 for married couples (phasing out at $1M).