The 4% inflation adjustment for the bottom two brackets (10% and 12%) is a nice win for lower-income earners compared to the 2.3% adjustment for the higher brackets. It’s subtle, but it should provide some genuine relief against the rising cost of living.
Finally, some 'bracket creep' protection that actually has teeth. Seeing the top 37% bracket start at over $768,000 for joint filers is a reminder that while the tax rates aren't moving, the definitions of 'wealthy' are. If you aren't adjusting your 2026 withholdings now, you're just giving the government an interest-free loan on your own inflation.
The IRS just gave us the 2026 roadmap. Between the $32k standard deduction for couples and the $24.5k 401(k) limit, the 'tax-free' or 'tax-deferred' ceiling is getting significantly higher. Great summary of the math.
The 4% inflation adjustment for the bottom two brackets (10% and 12%) is a nice win for lower-income earners compared to the 2.3% adjustment for the higher brackets. It’s subtle, but it should provide some genuine relief against the rising cost of living.
Finally, some 'bracket creep' protection that actually has teeth. Seeing the top 37% bracket start at over $768,000 for joint filers is a reminder that while the tax rates aren't moving, the definitions of 'wealthy' are. If you aren't adjusting your 2026 withholdings now, you're just giving the government an interest-free loan on your own inflation.
The IRS just gave us the 2026 roadmap. Between the $32k standard deduction for couples and the $24.5k 401(k) limit, the 'tax-free' or 'tax-deferred' ceiling is getting significantly higher. Great summary of the math.