The brackets have been released!… No, not the College Football Playoff, NFL Playoff, or NCAA brackets – we’re talking about the 2026 Tax Brackets! Last week, the IRS released the annual inflation adjustments for tax brackets and other key tax items. Here are the highlights:
2026 Marginal Rates
|
Tax Rate |
Single and Married Filing Separately |
Married Filing Jointly |
Head of Household |
|
10% |
$0 – $12,400 |
$0 – $24,800 |
$0 – $17,700 |
|
12% |
$12,401 – $50,400 |
$24,801 – $100,800 |
$17,701 – $67,450 |
|
22% |
$50,401 – $105,700 |
$100,801 – $211,400 |
$67,451 – $105,700 |
|
24% |
$105,701 – $201,775 |
$211,401 – $403,550 |
$105,701 – $201,775 |
|
32% |
$201,776 – $256,225 |
$403,551 – $512,450 |
$201,776 – $256,200 |
|
35% |
$256,226 – $640,600 |
$512,451 – $768,700 |
$256,201 – $640,600 |
|
37% |
$640,601 or more |
$768,701 or more |
$640,601 or more |
On average, tax parameters will increase by 2.7%. The One Big Beautiful Bill Act (OBBBA), passed in July 2025, made the Tax Cuts and Jobs Act (TCJA) tax structure permanent and added extra inflation adjustments for the two lowest brackets. For 2026, the 10% and 12% will increase by 4%, while higher brackets will see a 2.3% adjustment.
Standard Deduction
|
Filing Status |
2025 |
2026 |
|
Single; or Married Filing Separately |
$15,750 |
$16,100 |
|
Married Filing Jointly
|
$31,500 |
$32,200 |
|
Head of Household |
$23,625 |
$24,150 |
Most taxpayers reduce taxable income by claiming the standard deduction or itemizing. Under the OBBBA, the standard deduction increased by $750 for single filers and $1,500 for joint filers in 2025 compared to prior law. In 2026, it rises again by $350 (single) and $700 (joint).
Additional Deductions for Seniors (65+)
- Additional Standard Deduction: $2,050 (single), $1,650 (joint per spouse)
- New Bonus Senior Deduction: $6,000 per qualifying taxpayer (phases out at 6% for incomes over $75,000 single / $150,000 joint)
Long-Term Capital Gains Rates
|
|
Single and Married Filing Separately |
Married Filing Jointly |
Head of Household |
|
0% |
$0 – $49,450 |
$0 – $98,900 |
$0 – $66,200 |
|
15% |
$49,451 – $545,500 |
$98,901 – $613,700 |
$66,201 – $579,600 |
|
20% |
$545,501 or more |
$613,701 or more |
$579,601 or more |
Other Key Items
- Estate Tax Exclusion: Increasing to $15 million (from $13.99 million)
- Gift Tax Exclusion: Remains at $19,000
- Health Flexible Spending Accounts (FSA): Contribution limit rises to $3,400; carryover limit increases to $680
- Health Savings Account (HSA):
- Self-Only: $4,400 (up from $4,300)
- Family: $8,750 (up from $8,550)
- State and Local Tax (SALT) Deduction Cap: Increased $40,400 (from $40,000)
Sources:
https://schulerwealthplanning.com/how-does-the-one-big-beautiful-bill-act-affect-me/
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