Big Tax Law Changes Coming in 2026: What You Need to Know
Unified Consulting & Tax (KOAM CPAs LLC)
Major tax provisions from the 2017 Tax Cuts and Jobs Act (TCJA) are set to expire at the end of 2025, bringing big changes for individuals, families, and small business owners in 2026. Now is the time to prepare.
🔹 1. Individual Income Tax Rates Increase
Current rates (10%, 12%, 22%, 24%, 32%, 35%, 37%) will revert to pre-TCJA levels (10%, 15%, 25%, 28%, 33%, 35%, 39.6%), likely raising taxes for many households.
🔹 2. Standard Deduction Drops
Standard deductions will be reduced—estimated at around $8,350 (single) and $16,700 (married). Personal exemptions (about $5,300 per person) will return, possibly increasing taxable income for many.
🔹 3. Child Tax Credit Cut in Half
The credit will drop from $2,000 to $1,000 per qualifying child, and more families will be affected due to lower phaseout thresholds.
🔹 4. Business Owners Lose 20% QBI Deduction
Pass-through businesses like LLCs and S Corps will lose the 20% Qualified Business Income (QBI) deduction, resulting in significantly higher effective tax rates.
🔹 5. Estate & Gift Tax Exemption Shrinks
The current exemption (nearly $13.6M per person in 2024) will fall by about half—down to $6 million or less—meaning more estates may be subject to tax.
✅ What You Should Do Now
Review your income, deductions, and estate plan.
Consider gifts, Roth conversions, or business restructuring before 2026.
Schedule a planning session with a CPA to build a tax-efficient strategy now.
📞 Need help navigating the changes? (484) 222-0243
Contact Unified Consulting & Tax (KOAM CPAs LLC)
📧 john.kim@koamcpallc.com | 🌐 www.koamcpallc.com
Proactive tax planning today can save you significantly tomorrow.