Tax Planning
Planning Ahead: Inflation Adjustments & Key OBBB Changes for Small Businesses and Freelancers in 2026
Small business owners and freelancers should know the 2026 inflation adjustments and OBBB enhancements—how higher thresholds and deductions can reduce tax burden this filing season.
By NomadicTax Research Team • 5-8 min read • February 18, 2026
## 2026 Inflation-Related Adjustments at a Glance
Thanks to OBBB’s indexing provisions, many tax amounts were adjusted for inflation effective for **tax year 2026** (returns filed in 2027). Key changes include:
| Item | 2025 | 2026 |
|---|---|---|
| Standard Deduction (Single) | $15,750 | $16,100 ([irs.gov](https://www.irs.gov/newsroom/irs-releases-tax-inflation-adjustments-for-tax-year-2026-including-amendments-from-the-one-big-beautiful-bill?utm_source=openai))
| Married Filing Jointly | $31,500 | $32,200 ([irs.gov](https://www.irs.gov/newsroom/irs-releases-tax-inflation-adjustments-for-tax-year-2026-including-amendments-from-the-one-big-beautiful-bill?utm_source=openai))
| Heads of Household | $23,625 | $24,150 ([irs.gov](https://www.irs.gov/newsroom/irs-releases-tax-inflation-adjustments-for-tax-year-2026-including-amendments-from-the-one-big-beautiful-bill?utm_source=openai))
| Foreign Earned Income Exclusion | $130,000 | $132,900 ([irs.gov](https://www.irs.gov/newsroom/irs-releases-tax-inflation-adjustments-for-tax-year-2026-including-amendments-from-the-one-big-beautiful-bill?utm_source=openai))
| EITC (3+ kids, Max) | $8,046 | $8,231 ([irs.gov](https://www.irs.gov/newsroom/irs-releases-tax-inflation-adjustments-for-tax-year-2026-including-amendments-from-the-one-big-beautiful-bill?utm_source=openai))
## Updates from OBBB That Small Businesses & Freelancers Should Know
- Reduced reporting requirements for 1099-K and backup withholding thresholds, easing admin burden. ([irs.gov](https://www.irs.gov/newsroom/treasury-irs-issue-proposed-regulations-reflecting-changes-from-the-one-big-beautiful-bill-to-the-threshold-for-backup-withholding-on-certain-payments-made-through-third-parties?utm_source=openai))
- New deductions for tips and overtime applicable even if non-itemizing. Ideal for gig workers. ([irs.gov](https://www.irs.gov/newsroom/one-big-beautiful-bill-how-to-take-advantage-of-no-tax-on-tips-and-overtime?utm_source=openai))
- Employers should be aware of expanded charitable contribution deductions and increased employer childcare credits. Freelancers may benefit via increased deductions. ([irs.gov](https://www.irs.gov/newsroom/irs-releases-tax-inflation-adjustments-for-tax-year-2026-including-amendments-from-the-one-big-beautiful-bill?utm_source=openai))
## Actionable Tips for Planning Now
- **Estimate your 2026 taxable income**: with higher deductions and thresholds, adjust estimated tax payments accordingly to avoid underpayment penalties.
- **Track tips and overtime pay separately** (even without new forms in 2025) to support deduction claims. Keep stubs, statements. ([irs.gov](https://www.irs.gov/irb/2025-50_IRB?utm_source=openai))
- **Review platforms’ policies**: ensure platforms report correctly under 1099-K. If you fall under both the dollar & transaction thresholds, you’ll receive a 1099-K. ([irs.gov](https://www.irs.gov/newsroom/prepare-to-file-in-2026-get-ready-for-tax-season-with-key-updates-essential-tips?utm_source=openai))
- **Plan purchases and parental accounts**: If eligible, consider setting up “Trump Accounts” for children born between 2025-2028. ([irs.gov](https://www.irs.gov/newsroom/prepare-to-file-in-2026-get-ready-for-tax-season-with-key-updates-essential-tips?utm_source=openai))