By Kyle Plotkin
Investment Advisor Representative
[email protected]
At the start of each new year, FRS puts together a well-rounded guide to the tax rates and income limits commonly referenced in personal finance. Regular income tax rates, capital gains info, retirement account contribution limits, AMTs, 529s, QLACs, HSAs, and IRMAA are all on there, as are RMD formulas and much more. It’s enough abbreviations to make a can of Spaghetti-O’s jealous… or really confuse a toddler using those letter magnets that we all used to have on our fridge.
Anyway… If you’d like a copy of the guide to review, click the image above or download it right here.
If you’ve been keeping up with us these past few weeks, you know we have talked (at length) about the tax changes recently put in place. With this fairly comprehensive guide now put together, we’ll take a minute to review the info and changes once again.
Tax Rates & Effective Tax Rates for 2026
As you’re probably already aware, the tax brackets adjust for inflation each year. Major changes were scheduled for 2026 until the One Big Beautiful Bill extended the rates we’ve gotten used to over the past decade. The 2026 Tax Reference Guide includes the newly adjusted tax brackets for single, head of household, married filing separately, and married filing jointly.
2026 Standard Deduction
Unless they itemize, every taxpayer in the U.S. is able to claim a standard deduction. For 2026, the standard deduction is $16,100 for singles or those married and filing separately. It’s 1.5x that amount for heads of household (HoH) at $24,150, and it’s double for those married filing jointly, at $32,200. On top of that, seniors over 65 (and those who are blind) also get an extra deduction of $1,650 per married person or $2,050 for singles or HoH. So a single adult aged 65 will get a standard deduction of $17,750, a married couple both aged 65 will get a deduction of $35,500.
OBBBA Senior Bonus
Thanks to the 2025 One Big Beautiful Bill Act (OBBBA), some seniors age 65 and older may qualify—depending on income—for an additional deduction of $6,000 per person, or $12,000 for couples filing jointly. Couples who are married but filing separately are not eligible. If the seniors are making too much money, however, that bonus will start to phase out. For singles and heads of household, the bonus deduction starts to taper at $.06/dollar for every dollar over $75,000 in modified adjusted gross income (MAGI). For married filing jointly, the taper starts at $150,000, with the benefit being fully phased out at higher income levels.
State & Local Taxes Boost
Another OBBBA provision changes the rules on state and local tax (SALT) deductions. The cap on SALT deductions is raised from $10,000 to $40,400 for joint filers, allowing for homeowners in high-tax states to benefit from itemizing again. There is a phase-out for high earning couples with MAGI above $505,000 ($252,500 for singles), with earners above $750,000 still limited to the $10K deduction.
Retirement Savings Contributions Credit
For lower earners, there is a “saver’s credit” available up to $1,000 per individual if they contribute to a qualified retirement savings plan (IRA, 401(k), etc.). The credit amounts vary but are available (at least in part) to couples earning under $79,000 or singles under $39,500. This program will sunset after 2026 and be replaced by a “saver’s match” program beginning for 2027.
Additional Provisions from OBBBA
There are other new changes beginning this year, including deductions for interest paid on certain qualified new car purchases and a deduction up to $25,000 for some tipped workers.
We can’t cover every single change in the tax structure here, but again, you can download our 2026 Tax Reference Guide for more information.