New IRS Standard Deduction Changes for 2025 and 2026: What Taxpayers Need to Know

Every year, the IRS adjusts key tax figures to keep pace with inflation. These annual updates affect virtually every taxpayer in the country, whether you file as single, married, or head of household.

For 2025 and 2026, the IRS has announced notable increases in the standard deduction that will impact how millions of Americans calculate their taxable income.

Below, I explain what’s changing, why it matters, and how these new amounts could impact your tax return.

What Is the Standard Deduction?

The standard deduction is a flat dollar amount that reduces the income you must pay tax on. Instead of itemizing individual deductions (like mortgage interest or charitable donations), most taxpayers take this automatic deduction.

It’s one of the simplest and most powerful ways to lower your taxable income, and it adjusts every year to reflect inflation.

New Standard Deduction Amounts for 2025

For the 2025 tax year (returns filed in 2026), the IRS has increased the standard deduction:

• For single or married filing separately, the amount has increased from $14,600 to $15,700 — an increase of $1,100.
• For married filing jointly, the amount has increased from $29,200 to $31,400 — an increase of $2,200.
• For head of household, the amount has increased from $$21,900 to $31,400 — an increase of $1,700.

(Based on IRS inflation adjustment announcements for the 2025 tax year.)

These increases reflect the IRS’s annual inflation adjustment, helping taxpayers maintain purchasing power as living costs rise.

Projected Standard Deduction for 2026

The 2026 tax year will be especially significant. Unless Congress acts, several provisions from the Tax Cuts and Jobs Act (TCJA) — including the expanded standard deduction — are set to expire at the end of 2025.

If that happens, the standard deduction will drop back to roughly half of its current amount, adjusted for inflation.

For example:

• A married couple filing jointly could see their standard deduction fall from about $31,400 in 2025 to roughly $15,000–$16,000 in 2026.
• Single filers would drop from about $15,700 to around $8,000–$9,000.

This change would effectively raise taxable income for millions of Americans — unless lawmakers vote to extend the higher deduction levels.

How These Changes Affect You

If You Take the Standard Deduction

Most taxpayers (about 9 out of 10) take the standard deduction instead of itemizing. The 2025 increase means slightly lower taxable income and potentially smaller tax bills for many filers.

However, the potential 2026 rollback could have the opposite effect — increasing taxable income and tax owed unless Congress extends the TCJA provisions.

If You Itemize Deductions

If you typically itemize deductions, the larger standard deduction means you’ll need higher itemized totals to make itemizing worthwhile. This may especially affect homeowners who previously benefited from mortgage interest and property tax deductions.

‍‍ If You’re Married or a Family Filer

Married couples filing jointly and heads of household will continue to see the biggest dollar increases, offering modest relief against inflation in 2025.

But the 2026 sunset could have a major effect on family tax planning — particularly for those with children or larger deductions tied to dependents.

Tax Planning Tips for 2025–2026

1. Adjust your withholdings early – Review your paycheck withholdings for 2025 to ensure the correct tax amount is being withheld based on the new deduction levels.
2. Plan ahead for the 2026 rollback – If Congress doesn’t extend the TCJA, itemizing may become advantageous again in 2026.
3. Time your deductions – Consider when to make charitable donations, pay medical expenses, or prepay mortgage interest to maximize benefit depending on which year you plan to itemize.
4. Consult a tax professional – Strategic timing and understanding of these thresholds can help you minimize tax liability before major changes hit.

Texas Residents: How This Applies to You

Since Texas does not have a state income tax, your federal standard deduction plays an even more significant role in determining your overall tax burden.

Whether you’re a small business owner, retiree, or employee, understanding these federal changes can help you plan ahead and avoid surprises at tax time.

Final Thoughts

The increased standard deduction for 2025 provides a modest tax break for most households — but the projected 2026 rollback could dramatically reshape individual tax planning.

Now is the time to review your finances, anticipate future changes, and make informed decisions with the help of a trusted tax professional.

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