Tax Brackets 2025: Big Shifts Coming in 2026 Are You Ready?
The 2017 Tax Cuts and Jobs Act (TCJA) is set to expire soon, and with that comes some of the biggest changes to federal taxes in years. Whether you’re a business owner, a salaried worker, or filing jointly with a spouse, it’s important to understand what’s changing and when. If you’re wondering how Tax Brackets 2025 compare to what’s coming next, now is the time to prepare. This guide breaks down what to expect and how to plan for it.
What’s Changing in 2026?
The TCJA brought lower tax rates, higher standard deductions, and capped some deductions like SALT. But most of those changes were temporary, and they’ll end after 2025. That means Tax Brackets 2025 may be the last chance to enjoy these lower rates.
Beyond TCJA expirations, keep an eye on new legislative ideas like Trump’s proposal to eliminate individual income taxes to see how they might alter Tax Brackets 2025 planning.”
Key Changes Include:
- Higher tax rates and lower income thresholds.
- Return of personal exemptions.
- Removal of the $10,000 SALT deduction cap.
- A lower standard deduction.
- Reinstated limits on mortgage interest deductions.
Tax Brackets 2025 vs. 2026: Higher Rates Ahead
As the TCJA expires, tax brackets will go back to the older system but adjusted slightly for inflation. Here’s what the projected 2026 tax brackets may look like:
| Rate | Single | Married Filing Jointly |
|---|---|---|
| 10% | $0–$10,275 | $0–$20,550 |
| 12% | $10,276–$41,775 | $20,551–$83,550 |
| 22% | $41,776–$89,075 | $83,551–$178,150 |
| 24% | $89,076–$170,050 | $178,151–$340,100 |
| 32% | $170,051–$215,950 | $340,101–$431,900 |
| 35% | $215,951–$539,900 | $431,901–$647,850 |
| 39.6% | $539,901+ | $647,851+ |
📌 Tax Brackets 2025 are much more favorable especially for middle-income households. The same income could be taxed at a much higher rate starting in 2026. ( learn more)
Standard Deduction to Drop, Personal Exemptions Return
Under Tax Brackets 2025, the standard deduction you enjoy this year will be significantly higher than what’s coming next. In 2025, single filers can claim $14,600 and married couples filing jointly get $29,200. In 2026, those amounts are set to fall to $8,300 and $16,600, respectively. At the same time, personal exemptions eliminated by the TCJA will make a comeback, providing extra relief for each taxpayer and dependent.
Many households are now weighing this year’s standard deduction against the projected 2026 figures to see exactly how their bottom line will change.
The SALT Cap Goes Away in 2026
The $10,000 cap on the State and Local Tax (SALT) deduction will end in 2026. This could benefit people in high-tax states, but the gains may be offset by higher tax rates.
Again, Tax Brackets 2025 give you one more year to maximize your deductions under the current system.
A Lower Standard Deduction and Returning Personal Exemptions
In 2026, you’ll face a lower standard deduction than what you have under Tax Brackets 2025. This year, single filers claim $14,600 and married couples filing jointly get $29,200. Next year, those amounts shrink to $8,300 and $16,600, respectively. At the same time, personal exemptions, which the TCJA removed will return, giving you a fixed deduction for yourself and each dependent.
Comparing this year’s higher standard deduction with the projected 2026 figures can help you see how your taxable income will change.
Why You Should Act During Tax Brackets 2025
Planning now can save you thousands later. Consider:
- Shifting income into 2025 while rates are lower
- Bunching deductions (charity, SALT, mortgage interest) before caps and limits tighten
- Adjusting withholding or estimated payments to match your new tax bracket
- Talking to a tax advisor for a tailored strategy
For tailored guidance on both business and personal taxes, check out our Business & Personal Taxes Service
Conclusion
The tax code is changing in 2026, affecting both individuals and businesses. Taxpayers will see higher tax brackets and rates, along with changes in deductions and exemptions. It’s important to understand these changes and plan ahead.
Working with experts like JC Castle Accounting is key. They can help create a plan to lessen the impact of these changes. This way, you can be ready for the future, especially with an understanding of the estimated 2026 tax brackets and tax rates 2026.
Knowing about the 2026 tax changes is vital for good tax planning. It’s important to learn about the changes to tax brackets, rates, deductions, and exemptions. By planning ahead, you can make the most of new opportunities and lower your taxes.
Preparing for 2026 tax changes is a big part of managing your finances well. Working with accountants and financial advisors helps you stay ahead. This way, you can handle the changes smoothly and reach your financial goals.
By being proactive, you can be ready for the 2026 tax changes. This prepares you for long-term success.
FAQ
What makes Tax Brackets 2025 special?
They’re the last year under the TCJA’s lower rates. After 2025, most tax rates increase.
How much more will I pay in 2026?
It depends on your income. Many middle-income taxpayers could see a 4–9% increase in marginal rates.
What should I do in 2025 to prepare?
Consider shifting income into 2025, maxing out deductions, and working with a tax advisor to build a strategy.
Will business owners be affected in 2026?
Yes. They’ll lose the QBI deduction and bonus depreciation both of which help reduce taxes now.
