Tax Law and News

Annual IRS inflation adjustments: TY2025 and TY2026

Written by Mike D'Avolio, CPA, JD
Modified Jan 5, 2026
5 min read

The following chart outlines the year-over-year inflation adjustments on some higher impact provisions of the tax code. You can refer to these figures in planning for tax year 2026, and consider sharing with your individual and business tax clients. Also refer to the resources at the bottom for additional adjustments.

IRS releases tax inflation adjustments for tax year 2026, including amendments from the One, Big, Beautiful Bill

401(k) limit increases to $24,500 for 2026, IRA limit increases to $7,500

	Tax Year 2025	Tax Year 2026
Standard deduction	Married filing jointly: $31,500 Single taxpayers and married individuals filing separately: $15,750 Heads of households: $23,625	Married filing jointly: $32,200 Single taxpayers and married individuals filing separately: $16,100 Heads of households: $24,150
Personal exemption	$0	$0
Tax rates and brackets	Top rate is 37 percent for individual single taxpayers with incomes greater than $626,350 ($751,600 for married couples filing jointly). 35 percent, for incomes over $250,525 ($501,050 for married couples filing jointly) 32 percent for incomes over $197,300 ($394,600 for married couples filing jointly) 24 percent for incomes over $103,350 ($206,700 for married couples filing jointly) 22 percent for incomes over $48,475 ($96,950 for married couples filing jointly) 12 percent for incomes over $11,925 ($23,850 for married couples filing jointly) Lowest rate is 10 percent for incomes of single individuals with incomes of $11,925 or less ($23,850 for married couples filing jointly)	Top rate is 37 percent for individual single taxpayers with incomes greater than $640,600 ($768,700 for married couples filing jointly). 35 percent, for incomes over $256,225 ($512,450 for married couples filing jointly )32 percent for incomes over $201,775 ($403,550 for married couples filing jointly) 24 percent for incomes over $105,700 ($211,400 for married couples filing jointly) 22 percent for incomes over $50,400 ($100,800 for married couples filing jointly) 12 percent for incomes over $12,400 ($24,800 for married couples filing jointly) Lowest rate is 10 percent for incomes of single individuals with incomes of $12,400 or less ($24,800 for married couples filing jointly)
Alternative minimum tax exemption	$88,100 for single individuals and begins to phase out at $626,350 $137,000 for married couples filing jointly and begins to phase out at $1,252,700	$90,100 for single individuals and begins to phase out at $500,000 $140,200 for married couples filing jointly and begins to phase out at $1,000,000
Penalty for not maintaining minimum essential health	$0	$0
Dollar limitation for employee salary reductions for contributions to health flexible spending arrangements	$3,300	$3,400
Adjusted gross income amount used by joint filers to determine the reduction in the Lifetime Learning Credit	$160,000	$160,000
Maximum credit allowed for adoptions	$17,280	$17,670 (the amount of credit that may be refundable is $5,120)
Foreign earned income exclusion	$130,000	$132,900
Basic exclusion amount for estates of decedents	Estates of decedents who die during 2025: $13,990,000	Estates of decedents who die during 2025: $15,000,000
Annual exclusion for gifts	$19,000	$19,000
Standard mileage rates for the use of a car (also vans, pickups or panel trucks)	67 cents per mile driven for business use 21 cents per mile driven for medical or moving purposes 14 cents per mile driven in service of charitable organizations	72.5 cents per mile driven for business use 20.5 cents per mile driven for medical purposes 20.5 cents per mile driven for moving purposes for certain active-duty members of the Armed Forces (and now certain members of the intelligence community) 14 cents per mile driven in service of charitable organizations
Monthly limit on qualified transportation fringe benefits & qualified parking	$325	$340
Contribution limit for employees who participate in 401(k), 403(b), most 457 plans, and the federal government’s Thrift Savings Plan	$23,500	$24,500
Catch-up contribution limit for employees aged 50 and over who participate in 401(k), 403(b), most 457 plans and the federal government’s Thrift Savings Plan	$7,500	$8,000
Limit on annual contributions to an IRA	$7,000	$7,500
Catch-up contribution limit for individuals aged 50 and over (IRA)	$1,000	$1,100
If during the year either the taxpayer or their spouse was covered by a retirement plan at work, the deduction may be reduced, or phased out, until it is eliminated, depending on filing status and income	For single taxpayers covered by a workplace retirement plan, the phase-out range is: $79,000 to $89,000 For married couples filing jointly, where the spouse making the IRA contribution is covered by a workplace retirement plan, the phase-out range is: $126,000 to $146,000 For a married individual filing a separate return who is covered by a workplace retirement plan, the phase-out range is not subject to an annual cost-of-living adjustment and remains: $0 to $10,000	For single taxpayers covered by a workplace retirement plan, the phase-out range is: $81,000 to $91,000 For married couples filing jointly, where the spouse making the IRA contribution is covered by a workplace retirement plan, the phase-out range is: $129,000 to $149,000 For a married individual filing a separate return who is covered by a workplace retirement plan, the phase-out range is not subject to an annual cost-of-living adjustment and remains: $0 to $10,000
For an IRA contributor who is not covered by a workplace retirement plan and is married to someone who is covered, the deduction is phased out if the couple’s income is between:	$236,000 and $246,000	$242,000 and $252,000
Income phase-out range for taxpayers making contributions to a Roth IRA:	For singles and heads of household: $150,000 to $165,000 For married couples filing jointly, the income phase-out range is: $236,000 to $246,000 The phase-out range for a married individual filing a separate return who makes contributions to a Roth IRA is not subject to an annual cost-of-living adjustment and remains: $0 to $10,000	For singles and heads of household: $153,000 to $168,000 For married couples filing jointly, the income phase-out range is: $242,000 to $252,000 The phase-out range for a married individual filing a separate return who makes contributions to a Roth IRA is not subject to an annual cost-of-living adjustment and remains: $0 to $10,000
Income limit for the Saver’s Credit (also known as the Retirement Savings Contributions Credit) for low- and moderate-income workers	Married couples filing jointly: $79,000 Heads of household: $59,250 Singles and married individuals filing separately: $39,500	Married couples filing jointly: $80,500 Heads of household: $60,375 Singles and married individuals filing separately: $40,250
SIMPLE retirement contribution limit	$16,500	$17,000

Resources

Mike D’Avolio, CPA, JD, is a tax law specialist for Intuit® ProConnect™ Group, where he has worked since 1987. He monitors legislative and regulatory activity, serves as a government liaison, circulates information to employees and customers, analyzes and tests software, trains employees and customers, and serves as a public relations representative. More from Mike D'Avolio, CPA, JD