2026 Tax Law Changes: What the One Big Beautiful Bill Means for You
The One Big Beautiful Bill, signed in 2025, is the largest tax law change in a decade — and most of its new numbers apply starting tax year 2026. If you are reading this in late 2026 or early 2027, the figures below are the ones on your return. Every number here is from IRS Revenue Procedure 2025-32 unless noted, and each change links to a calculator that applies it to your situation.
1. The child tax credit is bigger
The credit rises to $2,200 per qualifying child for 2026, with up to $1,700 refundable — so a family with two children gets $4,400 even if they owe no income tax. The child and dependent care credit also gets a real boost: the top rate rises to 50% and the 35% band widens. See your numbers with the child tax credit calculator and the care credit calculator.
2. Retirement limits moved up again
The 401(k) elective deferral limit is $24,500 for 2026, with a $8,000 catch-up for ages 50+ — and workers ages 60–63 get an $11,250 super catch-up. The combined employee-plus-employer cap is $72,000 ($80,000 with catch-up). Traditional and Roth IRAs rise to $7,500 with a $1,100 catch-up. HSAs move to $4,400 (self) / $8,750 (family), plus $1,000 at 55+. Calculators: 401(k) catch-up, IRA limits, HSA.
3. Brackets and the standard deduction
Every bracket widened with inflation. The 2026 standard deduction is $16,100 single, $32,200 married filing jointly, $24,150 head of household, with the same 10% to 37% rate structure. The bracket calculator shows your exact marginal and effective rates, and the filing status comparison shows how much the choice is worth.
4. The EITC grew for every family size
The Earned Income Tax Credit maximum rises to $8,231 with three or more children ($7,316 with two, $4,427 with one, $664 with none), with phase-out ranges stretched for inflation. It is refundable — cash even if you owe no tax. Estimate yours with the EITC calculator.
5. Gift, charitable, and self-employed numbers
- Gift exclusion: $19,000 per person per year (up from $18,000) — gift tax calculator.
- Charitable IRA rollover (QCD): $111,000 per year from an IRA at 70½+ — QCD calculator.
- Foreign earned income exclusion: $132,900 — FEIE calculator.
- Standard mileage: 76¢ per business mile from July 1, 2026 (72.5¢ for the first half) — mileage calculator.
What did NOT change
Several anchors stay put: the Social Security wage base holds at $184,500 for 2026, the RMD age remains 73 (75 for those born in 1960 or later), and the 0%/15%/20% long-term capital gains brackets persist. The Saver’s Credit income limits also widened with inflation — see the Saver’s Credit calculator.
Where the math lands
Start with the federal income tax calculator to see your total bill, then check the refund estimator for where you will land on April 15, and read the full 2026 tax bracket guide and deduction list for the details behind each number.
Sources: IRS Revenue Procedure 2025-32 — 2026 inflation adjustments; IRS Newsroom announcements for tax legislation.