The 2026 tax season is here, and it’s time to start preparing your 2025 tax return. For most taxpayers, the filing deadline is April 15, 2026, so staying informed about updated thresholds, contribution limits, and credits is essential.
As with every year, the IRS has made inflation adjustments to tax brackets, standard deductions, retirement contribution limits, and health savings accounts. Several popular tax credits also remain available, including the Child Tax Credit and energy-related incentives.
By understanding what’s new for 2026, you can make informed financial decisions and potentially maximize your tax savings. This guide walks you through key updates and important reminders to help ensure a smooth, stress-free filing experience.
What’s New for the 2026 Tax Year?
As you prepare your 2025 return in 2026, here are the key updates to know:
Standard Deduction Adjustments
The IRS continues to adjust the standard deduction for inflation. Updated deduction amounts apply when filing your 2025 tax return in 2026.
Adjusted Tax Brackets
Federal income tax brackets have again been adjusted for inflation. While the tax rates remain the same (10%-37%), income thresholds have shifted upward.
Retirement Savings Contribution Limits
Annual contribution limits for retirement accounts are adjusted periodically for inflation.
- IRA contribution limits remain higher than pre-2024 levels.
- 401(k) contribution limits have also increased compared to prior years.
- Catch-up contributions remain available for those age 50 and older.
Learn more about Cutting Your 2025 Taxes Before the IRA Deadline.
Health Savings Accounts (HSA)
HSA contribution limits continue to rise with inflation adjustments, allowing individuals and families to set aside more pre-tax dollars for medical expenses.
Energy Tax Credits
Energy-efficient home improvement credits and clean energy incentives established under recent federal legislation remain available in 2026, with several multi-year provisions still in effect.
Child Tax Credit for the 2026 Filing Season
The Child Tax Credit (CTC) continues to provide valuable tax relief for families filing 2025 returns in 2026.
Key Benefits
- Maximum Credit: Up to $2,000 per qualifying child under age 17.
- Refundable Portion: A portion of the credit may be refundable through the Additional Child Tax Credit (ACTC), subject to income limits.
Eligibility Requirements
To qualify:
- The child must be under age 17 at the end of 2025.
- Must be your son, daughter, stepchild, foster child, sibling, stepsibling, or a descendant (such as grandchild, niece, or nephew).
- Must have lived with you for more than half the year.
- Cannot have provided more than half of their own financial support.
- Must be a U.S. citizen, national, or resident alien.
- Must be claimed as a dependent on your return.
- Must have a valid Social Security number issued before the filing deadline.
Income Phase-Outs
The Child Tax Credit begins phasing out when:
- Single Filers: Modified Adjusted Gross Income (MAGI) exceeds $200,000.
- Married Filing Jointly: MAGI exceeds $400,000.
The credit is reduced by $50 for every $1,000 above those thresholds.
How to Claim the Credit
To claim the Child Tax Credit:
- Complete Schedule 8812.
- Attach it to your Form 1040.
- Ensure each qualifying child meets all IRS requirements.
Current Tax Brackets and Standard Deduction (2026 Filing Season)
Understanding how tax brackets work is critical when planning your tax strategy.
Remember: tax rates apply only to portions of income within each bracket, not your entire income.
While the tax rates remain:
- 10%
- 12%
- 22%
- 24%
- 32%
- 35%
- 37%
The income thresholds for each bracket have been adjusted upward for inflation for the 2025 tax year (filed in 2026).
Similarly, the standard deduction has increased from prior years to account for inflation.
If you qualify for the standard deduction, it will reduce your taxable income before tax rates are applied.
For precise bracket thresholds and deduction amounts, reviewing official IRS updates or working with a tax professional is recommended.
IRA and HSA Contribution Limits for 2026 Filing
Maximizing retirement and healthcare savings contributions can reduce your taxable income while strengthening your long-term financial security.
IRA Contribution Limits
Traditional and Roth IRA contribution limits remain elevated compared to earlier years, with:
- A base annual contribution limit.
- An additional catch-up contribution for individuals age 50 and older.
Traditional IRA contributions may be tax-deductible depending on income and workplace retirement plan coverage. Roth IRA contributions are not deductible but allow tax-free qualified withdrawals in retirement.
HSA Contribution Limits
Health Savings Accounts continue to offer a triple tax advantage:
- Tax-deductible contributions
- Tax-free growth
- Tax-free withdrawals for qualified medical expenses
Individuals enrolled in a High Deductible Health Plan (HDHP) may contribute up to the annual IRS limit, with additional catch-up contributions available for those 55 and older.
Energy Tax Credits Available in 2026
Energy-related tax incentives remain a valuable opportunity for homeowners and vehicle byers.
Residential Clean Energy Credit
Homeowners may claim a percentage of the cost of qualifying renewable energy installations, including:
- Solar panels
- Solar water heaters
- Geothermal heat pumps
- Wind systems
- Battery storage systems
These credits help offset installation costs and reduce long-term energy expenses.
Energy Efficient Home Improvement Credit
Eligible upgrades may include:
- Insulation improvements
- Energy-efficient windows and doors
- High-efficiency HVAC systems
- Heat pumps
Annual credit limits apply per category and overall.
Clean Vehicle Credit
Tax credits remain available for eligible new and used electric vehicles, subject to:
- Income limits
- Vehicle price caps
- Assembly and battery sourcing requirements
Buyers should verify eligibility before purchasing, as requirements are more stringent than in previous years.
Estate Tax Exemption in 2026
The federal estate and gift tax exemption remains historically high but it is scheduled to decrease at the end of 2025 unless Congress takes action.
Beginning in 2026, the exemption is expected to revert to approximately half of its previously elevated amount (adjusted for inflation).
If your estate approaches current exemption thresholds, 2026 is an especially important time to review your estate planning strategy.
Additionally, some states maintain their own estate or inheritance taxes with separate exemption limits. Proper coordination between federal and state planning is essential.
Consulting with an estate planning professional can help you navigate these upcoming changes and protect generational wealth.
Get a Head Start on Your 2026 Taxes with The Cg Team
Tax laws continue to evolve, and 2026 brings important considerations for individuals, families, and business owners alike.
At Cg, our experienced professionals stay ahead of regulatory updates so you don’t have to. We’ll help you:
- Identify available deductions and credits
- Strategically plan retirement contributions
- Navigate estate planning considerations
- File accurately and on time
Contact The Cg Team today to ensure your 2026 tax season is smooth, strategic, and stress-free.
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