Lifestyle

The 2026 Tax Brackets Are Official—Here’s Exactly How Much More You’ll Pay (Or Save)

By CM Chaney · November 19, 2025

In a significant announcement that will affect millions of Americans’ wallets, the Internal Revenue Service has released its tax inflation adjustments for 2026. With substantial changes to standard deductions and tax brackets, most taxpayers will see meaningful differences in their tax returns. Here’s what you need to know about these critical updates.

Big Wins for Married Couples and Single Filers

The most notable change for 2026 is the increased standard deduction. Married couples filing jointly will see their standard deduction rise to $32,200—a $700 increase from 2025. Single taxpayers aren’t left behind, with their standard deduction increasing to $16,100. For heads of households, the new standard deduction will be $24,150, according to the IRS.

Understanding Your New Tax Bracket

The IRS maintained the seven-tier tax bracket system for 2026, with rates ranging from 10% to 37%. Here’s how the new income thresholds break down:

• 37% bracket: Begins at $640,600 for single filers; $768,700 for married filing jointly

• 35% bracket: Starts at $256,225 for single filers; $512,450 for married filing jointly

• 32% bracket: Applies to incomes over $201,775 (single); $403,550 (married)

• 24% bracket: Kicks in at $105,700 (single); $211,400 (married)

• 22% bracket: Starts at $50,400 (single); $100,800 (married)

• 12% bracket: Begins at $12,400 (single); $24,800 (married)

• 10% bracket: Applies to incomes below the 12% threshold

Important Changes for Families and Employers

Several family-focused tax benefits are seeing increases:

• The adoption credit maximum rises to $17,670

• Employer-provided childcare tax credit jumps dramatically to $500,000

• Earned Income Tax Credit increases to $8,231 for families with three or more children

Healthcare and Benefits Updates

Healthcare-related tax provisions are also getting adjustments:

• Health FSA contribution limits increase to $3,400

• Medical Savings Account deductibles range from $2,900 to $4,400 for self-only coverage

• Qualified transportation fringe benefits increase to $340 monthly

What Stays the Same?

Some key provisions remain unchanged:

• Personal exemptions stay at zero

• The annual gift tax exclusion remains at $19,000

• Lifetime Learning Credits maintain their current MAGI phaseout ranges

Planning Ahead: What These Changes Mean for You

These adjustments present several planning opportunities:

1. Married couples might benefit more from filing jointly due to the increased standard deduction

2. Higher tax bracket thresholds could mean lower taxes for some high earners

3. Families should review the enhanced adoption and childcare credits

4. Healthcare benefit increases offer more tax-advantaged saving opportunities

Key Takeaways

The 2026 tax year adjustments reflect the government’s response to inflation and economic changes. Understanding these updates now can help you make informed financial decisions throughout the year and potentially save money on your taxes.

Consider consulting with a tax professional to fully understand how these changes affect your specific situation and to develop strategies for maximizing your tax benefits under the new guidelines.