IRS Sets New Tax Brackets for 2026. See How They Have Changed.

The Republican tax law made permanent current tax rates that were set to expire at the end of this year. (Samuel Corum/Bloomberg)

Key Points

• The IRS announced inflation adjustments for 2026 tax brackets, increasing the standard deduction to $16,100 for individuals and $32,200 for married couples.
• The top marginal tax rate remains 37% for single filers with incomes over $640,600 and for married couples over $768,700.
• The estate tax exclusion for 2026 rises to $15 million, while the annual gift tax exclusion stays at $19,000 per recipient.

The Internal Revenue Service on Thursday announced the inflation adjustments for 2026 tax brackets and other provisions of the tax code.

For tax year 2026 (tax returns filed in 2027), the standard deduction rises to $16,100 for an individual and $32,200 for married couples filing jointly, up from $15,750 and $31,500 this year. The 2025 amounts were retroactively lifted over the summer in the Republicans’ tax and spending megalaw.

The additional standard deduction for people 65 and over is $1,650 for each married spouse aged 65 and over and $2,050 for single taxpayers. (Qualifying lower- and middle-income seniors received an additional senior deduction through 2028 in the One Big Beautiful Bill Act.)

The law made permanent the current tax rates that were set to expire at the end of this year, preventing a scheduled tax increase for 62% of taxpayers, according to the Tax Foundation, which made a calculator where taxpayers can see how the One Big Beautiful Bill Act will affect them based on their individual circumstances.

For 2026, the top marginal tax rate remains 37% for individual taxpayers with incomes greater than $640,600 or $768,700 for married couples filing jointly. The other rates and inflation-adjusted incomes are:

• 35% for incomes over $256,225 for single taxpayers or $512,450 for married couples filing jointly

• 32% for incomes over $201,775 or $403,550 for married couples filing jointly

• 24% for incomes over $105,700 or $211,400 for married couples filing jointly

• 22% for incomes over $50,400 or $100,800 for married couples filing jointly

• 12% for incomes over $12,400 or $24,800 for married couples filing jointly

• 10% for incomes of $12,400 or less for single individuals and $24,800 for married couples filing jointly

The exemption amount for the alternative minimum tax for tax year 2026 is $90,100 for single filers, beginning to phase out at $500,000, or $140,200 for married couples filing jointly, beginning to phase out at $1 million.

The estate tax exclusion for estates of people who die in 2026 is $15 million, up from $13.99 million this year. The annual gift tax exclusion remains unchanged at $19,000 per recipient.

The maximum contribution to flexible spending accounts for 2026 is $3,400, up $100 from $3,300 this year.

Write to Elizabeth O’Brien at elizabeth.obrien@barrons.com