The One, Big, Beautiful Bill Act, signed July 4, 2025, added new deductions and changed several credits. Here's a plain-English summary of what applies to your 2026 return, which you'll file in 2027.
Workers in jobs that customarily receive tips may deduct qualified tips reported on a W-2, 1099 or Form 4137. You can take it whether or not you itemize.
Up to $25,000 per year
Phases out above $150,000 MAGI ($300,000 joint)
Deduct the extra "half" of qualified time-and-a-half overtime pay, as reported on your W-2 or 1099. You can take it whether or not you itemize.
Up to $12,500 ($25,000 joint)
Phases out above $150,000 MAGI ($300,000 joint)
Deduct interest on a loan taken out after 2024 to buy a new, personal-use vehicle with final assembly in the U.S. Leases don't qualify. The VIN goes on your return.
Up to $10,000 per year
Phases out above $100,000 MAGI ($200,000 joint)
An extra deduction for each person age 65 or older by the end of the year, on top of the regular senior standard deduction. You can take it whether or not you itemize. Married couples must file jointly.
$6,000 per eligible person ($12,000 if both spouses qualify)
Phases out above $75,000 MAGI ($150,000 joint)
Standard deduction for 2026 returns
$16,100 Single | $32,200 Married Filing Jointly | $24,150 Head of Household
If you itemize, you can deduct up to $40,400 of state and local taxes for 2026 ($20,200 married filing separately).
$40,400; reduced above $505,000 MAGI, but not below $10,000
Made permanent by the new law. Up to $1,700 per child may be refundable. The child needs an SSN.
Up to $2,200 per qualifying child under 17
A refundable credit for low- to moderate-income workers
Up to $8,231 (3+ children)
Employee deferral limit for 401(k), 403(b), 457 plans
$24,500 (under 50) | $32,500 (age 50+) | $35,750 (age 60–63)
HSA contribution limits for high-deductible health plans
$4,400 Self-Only | $8,750 Family
Telehealth before the deductible is allowed permanently. Starting in 2026, bronze and catastrophic plans count as HSA-compatible.
More people can contribute to an HSA
A new savings account for children. The federal government makes a one-time $1,000 deposit for each eligible child born 2025 through 2028.
$1,000 one-time federal deposit; others may add up to $5,000 a year
Federal estate tax exemption amount
$15,000,000 (2026)
Our tax preparers can walk you through these changes and look for every credit and deduction you qualify for. Still need to file a 2025 return? We can help with that too.