2026 Federal Tax Brackets: Rates, Thresholds & Strategies

Single filers:

Rate	Taxable Income	Tax on Bracket
10%	$0 – $12,400	Up to $1,240
12%	$12,401 – $50,400	Up to $4,560
22%	$50,401 – $105,700	Up to $12,166
24%	$105,701 – $201,775	Up to $23,058
32%	$201,776 – $256,225	Up to $17,424
35%	$256,226 – $640,600	Up to $134,531
37%	Over $640,600	No cap

Married filing jointly:

Rate	Taxable Income	Tax on Bracket
10%	$0 – $24,800	Up to $2,480
12%	$24,801 – $100,800	Up to $9,120
22%	$100,801 – $211,400	Up to $24,332
24%	$211,401 – $403,550	Up to $46,116
32%	$403,551 – $512,450	Up to $34,848
35%	$512,451 – $768,600	Up to $89,653
37%	Over $768,600	No cap

Head of household:

• 10%: Up to $17,700
• 12%: $17,701 to $67,450
• 22%: $67,451 to $105,700
• 24%: $105,701 to $201,775
• 32%: $201,776 to $256,200
• 35%: $256,201 to $640,600
• 37%: Over $640,600

Married filing separately thresholds mirror single filers through the 32% bracket, then compress: the 35% bracket runs from $256,226 to $384,350, and the 37% rate kicks in above $384,350.

March 2026 CPI came in at 330.293 — a 3.3% year-over-year increase and the hottest reading since May 2024. The month-over-month jump of 0.9% was the largest since June 2022, driven by energy costs (Iran conflict) and continued tariff pass-through into consumer goods.

Here's the counterintuitive implication: higher inflation is actually good news for your 2027 tax brackets.

The IRS will set 2027 thresholds based on chained CPI data running through mid-to-late 2026. If inflation stays elevated — and with the effective tariff rate still around 8% and oil prices elevated — the adjustment could land near 3%, compared to the 2.7% used for 2026. That would push the 12% bracket for single filers from $50,400 to roughly $51,900, and the standard deduction from $16,100 to approximately $16,600.

What does an extra $500 in standard deduction mean in practice? For a 22%-bracket filer, it's $110 less in federal tax. Modest on its own, but it compounds: wider brackets plus a higher deduction floor means more income sheltered at lower rates every year inflation runs hot.

The catch: inflation erodes purchasing power faster than bracket indexing restores it. A 3.3% CPI increase on a $75,000 salary represents $2,475 in lost purchasing power. The bracket adjustment saves roughly $150–200 in taxes. You come out behind — the indexing cushions the blow, it doesn't eliminate it.

Parameter	2026 Actual	Est. 2027 (3% adj.)	Change
12% bracket (single)	$50,400	~$51,900	+$1,500
22% bracket (single)	$105,700	~$108,900	+$3,200
Standard deduction (single)	$16,100	~$16,600	+$500
Standard deduction (MFJ)	$32,200	~$33,200	+$1,000
401(k) limit	$24,500	~$25,000	+$500

The OBBBA applied a 4% inflation adjustment to the 10% and 12% brackets — roughly double the 2.3% adjustment for higher brackets. Here's the single filer comparison:

Rate	2025 Threshold	2026 Threshold	Change
10%	Up to $11,925	Up to $12,400	+$475 (+4.0%)
12%	$11,926 – $48,475	$12,401 – $50,400	+$1,925 (+4.0%)
22%	$48,476 – $103,350	$50,401 – $105,700	+$2,350 (+2.3%)
24%	$103,351 – $197,300	$105,701 – $201,775	+$4,475 (+2.3%)
32%	$197,301 – $250,525	$201,776 – $256,225	+$5,700 (+2.3%)
35%	$250,526 – $626,350	$256,226 – $640,600	+$14,250 (+2.3%)
37%	Over $626,350	Over $640,600	+$14,250 (+2.3%)

The standard deduction also jumped: $15,000 to $16,100 for single filers (+7.3%), and $30,000 to $32,200 for married couples filing jointly (+7.3%). That's a bigger increase than any year since the TCJA's original near-doubling in 2018.

The 4% bottom-bracket adjustment deserves scrutiny. Regular chained CPI would have produced roughly 2.7% — the same as higher brackets. Congress chose to override the formula, effectively giving lower-income filers a one-time bonus adjustment. Whether this becomes a recurring override or a one-off depends on future legislation. For planning purposes, assume 2027 reverts to the standard chained CPI formula across all brackets.

Bottom line: a single filer with $50,000 in gross income pays roughly $340 less in 2026 than in 2025. A married couple at $100,000 saves about $520. The savings are real but modest — the bigger story is permanence. These rates aren't expiring.

The progressive system taxes each dollar only at the rate for its bracket. Your marginal rate is always higher than your effective rate. Here's what real filers pay at three common income levels.

Single filer, $75,000 gross income:

• Standard deduction: $16,100
• Taxable income: $58,900
• $12,400 at 10% = $1,240
• $38,000 at 12% = $4,560
• $8,500 at 22% = $1,870
• Total tax: $7,670 — effective rate 10.2% (marginal rate: 22%)

Married filing jointly, $150,000 gross income:

• Standard deduction: $32,200
• Taxable income: $117,800
• $24,800 at 10% = $2,480
• $76,000 at 12% = $9,120
• $17,000 at 22% = $3,740
• Total tax: $15,340 — effective rate 10.2% (marginal rate: 22%)

Single filer, $250,000 gross income:

• Standard deduction: $16,100
• Taxable income: $233,900
• $12,400 at 10% = $1,240
• $38,000 at 12% = $4,560
• $55,300 at 22% = $12,166
• $96,075 at 24% = $23,058
• $32,125 at 32% = $10,280
• Total tax: $51,304 — effective rate 20.5% (marginal rate: 32%)

Notice: the $150,000 married couple and the $75,000 single filer pay the same effective rate (10.2%). That's the joint filing advantage — double-wide brackets mean a couple's combined income gets taxed as if each spouse earned half.

Model your own numbers with our tax bracket calculator.

The 22%-bracket investor sells $30,000 of appreciated stock and braces for a $6,600 tax hit. The actual bill, depending on filing status and other income, can be as low as $0.

Long-term capital gains — profits on assets held more than a year — run on a separate, far gentler bracket system than ordinary income. The IRS confirmed the 2026 thresholds in Revenue Procedure 2025-32:

LTCG Rate	Single (Taxable Income)	MFJ (Taxable Income)	Head of Household
0%	Up to $49,450	Up to $98,900	Up to $66,200
15%	$49,451 – $545,500	$98,901 – $613,700	$66,201 – $579,600
20%	Over $545,500	Over $613,700	Over $579,600

Stack these against ordinary brackets and the gap is striking. A married couple with $90,000 of wage income pays ordinary tax at the 12% marginal rate. The same couple with $90,000 of qualified dividends and long-term capital gains pays zero — every dollar falls inside the 0% LTCG bracket.

The 0% bracket is the most under-used tax shelter in the code. A retiree drawing $40,000 from a pension and holding $200,000 in appreciated index funds can sell positions strategically each year — using up the 0% LTCG headroom to harvest gains tax-free, then repurchasing the same shares immediately. No wash-sale rule applies to gains (it only blocks loss harvesting). The cost basis steps up; the future tax bill shrinks. Done over five years, that's a meaningful chunk of stepped-up basis at zero federal cost.

The strategy interlocks with the tax-loss harvesting playbook: harvest losses in years your income pushes you into 15%+ LTCG territory, harvest gains in years your income drops back into the 0% bracket. Most retail investors do neither — and pay capital gains tax they never had to owe.

Watch for the Net Investment Income Tax cliff. Above $200,000 modified AGI (single) or $250,000 (MFJ), capital gains, dividends, interest, and most passive income face an additional 3.8% surtax — the NIIT, set by the Affordable Care Act in 2013 and never inflation-adjusted. A high earner in the 20% LTCG bracket effectively pays 23.8% on long-term gains. Because the thresholds haven't moved in 13 years, wage growth has steadily pulled more households into NIIT range — bracket creep masquerading as a stable tax.

Short-term gains (assets held one year or less) are taxed at ordinary rates and don't get the LTCG schedule's mercy. Mixing the two buckets when planning year-end sales is the most common — and most expensive — mistake non-professional investors make. A 365-day holding period vs. a 366-day holding period can be the difference between a 32% bill and a 15% bill on the same trade. See our capital gains deep-dive for the full short-term/long-term framework.

The standard deduction is subtracted from gross income before brackets apply. For 2026:

• Single / Married filing separately: $16,100
• Married filing jointly: $32,200
• Head of household: $24,150

Seniors (65+) get an additional $2,050 (single) or $1,650 per spouse (married). The OBBBA also created a new $6,000 deduction for taxpayers 65 and older — available whether you itemize or take the standard deduction — that phases out at 6% of income above $75,000 (single) or $150,000 (joint). A couple both 65+, both under the phase-out: $32,200 + $3,300 + $12,000 = $47,500 in total deductions before a single dollar gets taxed.

A married couple under 65 earning $80,000 has taxable income of $47,800 after the $32,200 standard deduction. Their entire bill falls within the 10% and 12% brackets — $5,240 total, an effective rate of 6.6%.

Roughly 90% of filers claim the standard deduction. Itemizing still wins if your mortgage interest, state and local taxes (capped at $10,000 under SALT), and charitable contributions exceed the standard deduction — but with 30-year mortgage rates around 6.0%–6.4%, anyone who locked in a lower rate during 2020–2021 is earning less mortgage interest deduction than they expected.

Knowing your marginal bracket tells you exactly how much each deduction saves. A dollar of deduction in the 24% bracket saves 24 cents; in the 12% bracket, 12 cents. Target the highest-impact moves first.

Max out your 401(k). The 2026 limit is $24,500 ($32,500 if 50+, $35,750 if 60–63 under the SECURE 2.0 super catch-up). Every dollar reduces taxable income at your marginal rate. A 24%-bracket worker contributing $24,500 saves $5,880 in federal tax alone — before state savings.

IRA contributions hit $7,500. Up from $7,000 in 2025, with a catch-up of $1,100 for those 50+, totaling $8,600. A traditional IRA contribution is deductible at your marginal rate if you're not covered by an employer plan, or if your MAGI is below the phase-out threshold.

HSA contributions. If you have a high-deductible health plan, contribute $4,400 (individual) or $8,750 (family) to a Health Savings Account. The HSA is the only account with a triple tax advantage: deductible going in, tax-free growth, tax-free withdrawals for medical expenses.

Harvest investment losses. Tax-loss harvesting lets you sell underwater positions to offset capital gains and up to $3,000 of ordinary income per year. With tariff-driven volatility and Iran-conflict energy shocks hitting portfolios in Q2 2026, there are likely harvestable losses to capture.

Bunch deductions. If your itemized deductions hover near the standard deduction threshold, accelerate two years of charitable giving into one year to clear the $16,100 bar, then take the standard deduction the next year. Donor-advised funds make this simple.

Stack all three. A 24%-bracket worker contributing $24,500 to a 401(k), $7,500 to an IRA, and $4,400 to an HSA reduces taxable income by $36,400 — saving $8,736 in federal tax.

Between jobs, on sabbatical, or in early retirement? A Roth conversion lets you move traditional IRA or 401(k) money into a Roth, paying tax now at a lower rate to avoid tax later at a potentially higher one.

The math is straightforward. If your taxable income drops to $40,000 in a gap year, you're in the 12% bracket. You could convert $10,400 to fill the 12% bracket (reaching $50,400) at just 12 cents per dollar. Push further into the 22% bracket if you expect to face 24%+ rates in retirement. Every dollar converted below your future rate is arbitrage.

Two caveats: Roth conversions count as income for Medicare premium surcharges (IRMAA) and can affect estimated tax payment requirements. Plan conversions across multiple years to stay below bracket thresholds — the 22% bracket stretches to $105,700 for single filers, giving substantial room for strategic partial conversions.

The OBBBA's permanence makes this decision simpler. Before July 2025, you had to guess whether rates would revert to pre-TCJA levels. Now you know: the 22% bracket isn't going anywhere. That certainty lets you convert with confidence.

Until July 2025, the biggest uncertainty in tax planning was whether the TCJA's individual provisions would sunset. That would have meant higher rates — the 12% bracket reverting to 15%, the 22% to 25%, the 37% to 39.6% — and a standard deduction cut roughly in half.

The One Big Beautiful Bill Act eliminated that cliff. Four changes matter most:

Wider brackets than projected. The OBBBA applied a 4% inflation adjustment to the 10% and 12% brackets — roughly double the 2.3% adjustment for higher brackets. The 12% bracket now stretches to $50,400 for single filers, sheltering more middle-income earnings at the lower rate.

Standard deduction boost. The jump from $15,000 to $16,100 for single filers (and $30,000 to $32,200 for MFJ) was the largest single-year increase since 2018. This alone saves a 22%-bracket single filer $242 compared to 2025.

$15 million estate exemption. The TCJA's doubled exemption is now permanent and inflation-indexed. Fewer than 0.1% of estates exceed $15 million — for most families, estate tax is no longer a planning concern.

Senior deduction. The new $6,000 deduction for taxpayers 65+ (phasing out above $75,000/$150,000) stacks with the existing additional standard deduction. A single filer 65+ earning $60,000 gets $16,100 + $2,050 + $6,000 = $24,150 in deductions — leaving just $35,850 in taxable income and a federal bill of $4,058.

The Alternative Minimum Tax used to ensnare more than 5 million households each year. After the TCJA's exemption hike — locked in permanently by the OBBBA — the AMT now hits roughly 200,000 returns nationwide.

For 2026, the IRS set:

• Exemption (single): $90,100, phasing out 25 cents per dollar of AMTI above $500,000
• Exemption (MFJ): $140,200, phasing out 25 cents per dollar of AMTI above $1,000,000
• AMT rates: 26% on AMTI up to $244,500, 28% above

The AMT runs a parallel calculation. Start with regular taxable income, add back certain "preference" items — large state and local tax deductions (now mostly defanged by the $10,000 SALT cap), incentive stock option (ISO) exercises with a bargain element, accelerated depreciation on rental properties — then subtract the AMT exemption and apply 26%/28%. You owe whichever number is higher: regular tax or AMT.

Three groups still trip the AMT in 2026:

1. ISO exercisers with large bargain elements. A tech employee exercising $500,000 of ISOs at a $50/share spread when they trade at $200/share creates $750,000 of AMTI preference — almost guaranteed AMT exposure that year.
2. Taxpayers with significant pre-cap state taxes. Less of an issue post-SALT cap, but residents of high-tax states with property tax assessments over $20,000 still see preference build-up.
3. Real estate professionals with depreciation-heavy structures. Pass-through depreciation that reduces regular taxable income often becomes an AMT add-back.

For wage-and-401(k) filers with SALT capped at $10,000 and no equity compensation, the AMT is mathematically out of reach. It's worth running the AMT calculation in years with ISO exercises above $50,000 in spread, large one-time deductions, or sizable estate-plan moves — but most tax software (TurboTax, H&R Block, FreeTaxUSA) handles the parallel calculation automatically. Don't assume "doesn't apply to me" without verifying. See our AMT 2026 deep-dive for the full preference-item list and worked examples.

New bracket thresholds mean your W-4 withholding may no longer match your actual liability. If you received a large refund or owed a balance for 2025, revisit your withholding now.

The IRS requires quarterly estimated tax payments from anyone who expects to owe $1,000+ and won't have at least 90% of the current year's tax withheld. The 2026 deadlines:

• Q1: April 15, 2026
• Q2: June 15, 2026
• Q3: September 15, 2026
• Q4: January 15, 2027

Safe harbor: you avoid penalties if you pay at least 100% of last year's tax liability (110% if AGI exceeds $150,000) or 90% of this year's liability, whichever is smaller.

Self-employed filers face both income tax and self-employment tax (15.3% on the first $176,100 of net earnings, 2.9% above that). The deduction for the employer-equivalent portion reduces your AGI, which affects bracket position and credit eligibility. A SEP IRA contribution — up to 25% of net self-employment income, max $70,000 — is the single best tax shelter available to the self-employed.

The filing deadline for 2026 returns is April 15, 2027. Extensions push filing to October 15, 2027, but any tax owed is still due by April 15.

One more thing: if your income puts you near the Alternative Minimum Tax threshold, check whether large deductions or incentive stock option exercises trigger AMT liability. The OBBBA's higher AMT exemption ($90,100 single, $140,550 joint) protects more filers, but high-income earners in high-tax states still need to run the numbers.