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) |
| Married Filing Jointly | $31,500 | $32,200 (irs.gov) |
| Heads of Household | $23,625 | $24,150 (irs.gov) |
| Foreign Earned Income Exclusion | $130,000 | $132,900 (irs.gov) |
| EITC (3+ kids, Max) | $8,046 | $8,231 (irs.gov) |
Updates from OBBB That Small Businesses & Freelancers Should Know
- Reduced reporting requirements for 1099-K and backup withholding thresholds, easing admin burden. (irs.gov)
- New deductions for tips and overtime applicable even if non-itemizing. Ideal for gig workers. (irs.gov)
- Employers should be aware of expanded charitable contribution deductions and increased employer childcare credits. Freelancers may benefit via increased deductions. (irs.gov)
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)
- 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)
- Plan purchases and parental accounts: If eligible, consider setting up “Trump Accounts” for children born between 2025-2028. (irs.gov)