TaxPublished: March 31, 2026

New IRS Rules for 2026: What Changed

Key updates to tax regulations that affect your 2025 tax return and 2026 tax year.

📋 Quick Summary

✓ Tax brackets adjusted for inflation
✓ Standard deduction increased
✓ New 1099-K reporting threshold
✓ Retirement contribution limits raised
✓ Clean energy credit expansions

1. Tax Bracket Adjustments

The IRS has adjusted all federal income tax brackets for inflation. For tax year 2025 (filing in 2026):

2025 Tax Brackets (Single Filers)

Tax Rate	Income Range
10%	$0 - $11,600
12%	$11,600 - $47,150
22%	$47,150 - $100,525
24%	$100,525 - $191,950
32%	$191,950 - $243,725
35%	$243,725 - $609,350
37%	$609,350+

Note: Married filing jointly brackets are roughly double. Check IRS.gov for complete tables.

Pro Tip: Understanding your marginal tax rate helps you make smart decisions about deductions, retirement contributions, and income timing.

2. Standard Deduction Increase

The standard deduction has increased for 2025:

Single filers: $14,600 (up from $14,200)
Married filing jointly: $29,200 (up from $28,400)
Head of household: $21,900 (up from $21,200)

3. 1099-K Reporting Changes

The IRS has implemented new reporting requirements for third-party payment processors:

Threshold lowered to $5,000 for 2025 (from $20,000)
Affects: PayPal, Venmo, Cash App, Stripe users with business transactions
Personal payments (friends/family) not affected
Important: Mark transactions correctly in apps

Important: Make sure to mark personal payments correctly in payment apps to avoid unnecessary tax reporting.

Learn more: IRS 1099-K FAQs

4. Retirement Contribution Limits

401(k) and Similar Plans

2025 limit: $23,500 (up from $23,000)
Age 50+ catch-up: Additional $7,500
Total max (age 50+): $31,000

IRA Contributions

2025 limit: $7,000 (unchanged from 2024)
Age 50+ catch-up: Additional $1,000

SEP IRA (Self-Employed)

2025 limit: $69,000 or 25% of compensation

Maximize Savings: Increase your retirement contributions to take advantage of the higher limits and reduce your taxable income.

5. Clean Energy Tax Credits

Expanded credits for renewable energy improvements:

Residential Clean Energy Credit: 30% for solar panels, battery storage, wind turbines
Energy Efficient Home Improvement: Up to $3,200 annually for heat pumps, windows, insulation
EV Tax Credit: Up to $7,500 for qualifying electric vehicles

Details: IRS Energy Credits

6. Child Tax Credit Updates

Credit amount: $2,000 per qualifying child (unchanged)
Refundable portion: Up to $1,700 (up from $1,600)
Phase-out: Begins at $200,000 (single), $400,000 (joint)

7. Mileage Rates

Standard mileage rates for 2025:

Business: 70 cents per mile (up from 67 cents)
Medical/moving: 21 cents per mile
Charitable: 14 cents per mile (set by statute)

8. Estate and Gift Tax

Estate tax exclusion: $13.99 million per person (up from $13.61 million)
Annual gift exclusion: $19,000 per recipient (up from $18,000)

9. Health Savings Account (HSA)

Individual: $4,300 (up from $4,150)
Family: $8,550 (up from $8,300)
Age 55+ catch-up: Additional $1,000

10. Social Security Tax Wage Base

2025 wage base: $176,100 (up from $168,600)
Earnings above this limit not subject to Social Security tax
Medicare tax applies to all wages (no cap)

What This Means for You

Action items:

Review your withholding - adjust W-4 if needed
Maximize retirement contributions with new limits
Track business expenses if you receive 1099-K income
Consider clean energy improvements for credits
Consult a tax professional for personalized advice

Resources

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