📅 2026 Update: Changes to Federal and State Tax Laws

Since the original article was published, there have been several significant changes to tax laws that are important for taxpayers. These updates affect standard deductions, charitable contributions, and other deductions that impact how individuals file their taxes. The earlier article continues further down the page and provides additional context on these topics.

💰 Standard Deduction Increase

The standard deduction has increased for the 2026 tax year. For single filers and married individuals filing separately, it is now $16,100, up from $15,000 in 2025. Married couples filing jointly can claim $32,200, an increase from $30,000.

Heads of household have a deduction of $24,150, up from $23,000. This change allows taxpayers to reduce their taxable income more significantly.

🎁 Charitable Deduction for Non-Itemizers

Starting in 2025, taxpayers who claim the standard deduction can deduct cash charitable donations. Single filers can deduct up to $1,000, while married couples filing jointly can deduct up to $2,000. This applies to donations made to qualified 501(c)(3) public charities and lasts through 2028.

This provision encourages giving while benefiting taxpayers.

👴 Senior Tax Deduction

Individuals aged 65 and older can benefit from an additional $6,000 federal tax deduction starting in 2025. This deduction applies regardless of whether the taxpayer itemizes their deductions. The goal is to provide financial relief to seniors during tax filing.

🍽️ Elimination of Federal Income Tax on Tips

Beginning with the 2025 tax year, federal income tax on tips has been eliminated for tipped workers. This change aims to lower the tax burden on those who rely on tips as a significant part of their income, helping them keep more of what they earn.

📌 Key Points Summary

  • - Standard deduction increases to $16,100 for single filers.
  • - Charitable deductions available for those claiming the standard deduction.
  • - Seniors aged 65+ can claim an additional $6,000 deduction.
  • - Federal income tax on tips is eliminated for tipped workers.
  • - Changes effective from 2025 to 2028 for various deductions.

💡 Tips for Navigating Tax Changes

It's important to discuss your specific tax situation with an attorney. Understanding how recent changes affect your filing will help you maximize deductions.

📝 Review Your Eligibility for Deductions

Check if you qualify for the standard deduction or if itemizing is better for you. The increased amounts for 2026 could significantly impact your taxable income.

🎉 Take Advantage of the Charitable Deduction

If you're planning to make charitable donations, remember that you can now deduct up to $1,000 or $2,000, depending on your filing status. This can help lower your tax bill while supporting causes you care about.

👵 Utilize the Senior Tax Deduction

If you or your spouse is 65 or older, ensure you claim the additional senior tax deduction. This is a straightforward way to reduce your taxable income, regardless of other deductions.

💸 Keep Track of Tips and Overtime

If you work in a tipped position or earn overtime pay, you may qualify for new deductions introduced by the OBBBA. Keep detailed records to take advantage of these benefits.

🚗 Consider Car Loan Interest Deductions

If you have a car loan, you may be eligible to deduct interest payments. This deduction can provide relief for those with modified adjusted gross incomes under specific thresholds.

🏆 Tax Services Ranked by User Reviews (2026)

Several services help taxpayers with their tax filings. These services have been evaluated based on Trustpilot data from October 2026. Ratings fluctuate over time, and while star ratings are valuable, they only reflect a portion of customer experiences.

🥇 1. 1040.com

1040.com has been rated 4.5 out of 5 stars. It is known for its user-friendly interface and flat-rate pricing, making it accessible for many taxpayers. However, some users report navigation challenges and occasional technical glitches during the filing process.

🥈 2. efile4Biz

efile4Biz holds a Trustpilot score of 4.7. Reviewers have praised its easy online filing and affordability of services. Nevertheless, some users have mentioned occasional navigation issues and limitations in customer support that could affect the overall experience.

🥉 3. TaxSlayer

TaxSlayer averages 4.2 stars. It is known for its online tax preparation services and affordable pricing. However, users have pointed out occasional technical issues and concerns regarding pricing that may affect their choice to use the service.

🆓 Free Tax Assistance Programs

The IRS offers free programs like the Free File program, which provides online tax preparation for eligible taxpayers with an adjusted gross income of $73,000 or less. Additionally, Volunteer Income Tax Assistance (VITA) offers free help to those making $60,000 or less, while Tax Counseling for the Elderly (TCE) focuses on seniors aged 60 and older.

🔎 What to Compare When Choosing Tax Services

  • - 💲 Pricing structure and affordability.
  • - 🖥️ User interface and ease of navigation.
  • - 📞 Availability and quality of customer support.
  • - 🔄 Features for filing types, including state and federal options.
  • - 📝 Reviews and overall user experiences.

❓ Frequently Asked Questions

❓ What is the new standard deduction for 2026?

The standard deduction for single filers is $16,100, while married couples filing jointly can claim $32,200. Heads of household receive a deduction of $24,150.

💵 Who qualifies for the new charitable deduction?

Taxpayers who claim the standard deduction can deduct up to $1,000 for single filers and $2,000 for married couples filing jointly in cash donations to qualified charities.

👵 Can seniors benefit from additional deductions?

Yes, individuals aged 65 and older can claim an additional federal tax deduction of $6,000, effective for the 2025 tax year and applicable through 2028.

📅 When is the tax filing deadline for 2025?

The deadline to file individual tax returns for the 2025 tax year is April 15, 2026. If that date falls on a weekend or holiday, it is typically extended to the next business day.

🚫 Are tips still taxed as income?

As of the 2025 tax year, federal income tax on tips has been eliminated for tipped workers, easing their tax burden.

🚗 What is the car loan interest deduction?

Starting in 2025, individuals can deduct interest paid on loans for qualified vehicles, up to $10,000 per year, with phaseouts based on income levels.

⚖️ Recent Court Cases Related to Tax Laws

Recent court rulings have addressed various aspects of tax laws, including deductions and taxation practices. These rulings can significantly impact how taxpayers approach their filings and understand their obligations.

For more information, browse more rulings on the news page.

End of October 2026 Update





Recent Attention and Changes to Tax Laws


Taxes are an important aspect of the economic structure of any country. They are used to fund public goods and services, such as road maintenance, education, healthcare, and social security. Governments use tax laws as a tool to regulate and control the flow of funds in the economy. Tax law changes often receive a lot of attention because they have the potential to affect everyone – from individuals to large corporations. In this article, we will discuss recent attention and changes to tax laws in the United States and around the world.

The United States Tax Cuts and Jobs Act of 2017


The United States Tax Cuts and Jobs Act of 2017 (TCJA) is one of the most significant tax law changes in recent times. The legislation was signed into law by President Donald Trump on December 22, 2017. This law was meant to reduce the burden of taxes on individuals and businesses, spur economic growth, and create more jobs.

The TCJA lowered the corporate tax rate from 35% to 21%, which is one of the lowest in the developed world. This reduction made the United States more attractive to foreign investors who were looking for better investment opportunities. The law also introduced a new tax structure for pass-through businesses, which is a type of business where the profits and losses are passed through to the owners and taxed at their individual rates.

One of the most controversial aspects of the TCJA was the elimination of the individual mandate in the Affordable Care Act (ACA). The ACA required individuals to have health insurance or pay a fine. The TCJA repealed the penalty for not having health insurance, which could have a significant impact on the number of people covered by health insurance.

The TCJA also increased the standard deduction for individuals and families. The standard deduction is the amount of income that is not subject to taxation. For individuals, the standard deduction increased from $6,350 to $12,000, and for married couples filing jointly, it increased from $12,700 to $24,000. This change could result in a reduction in the number of people who itemize their deductions, which could simplify tax preparation for many individuals.

Overall, the TCJA was a significant change in tax law that will have long-term consequences for individuals and businesses in the United States.

International Tax Law Changes


In recent years, there has been a global effort to overhaul the international tax system. Countries are looking to prevent tax evasion and other forms of aggressive tax planning by multinational corporations. Some of the key changes to international tax laws include:

- The Base Erosion and Profit Shifting (BEPS) Action Plan: BEPS is a comprehensive plan developed by the Organisation for Economic Co-operation and Development (OECD) to address tax avoidance by multinational enterprises. The plan includes fifteen action points that aim to redefine international tax laws and close loopholes.

- The Common Reporting Standard (CRS): The CRS is a global standard for the automatic exchange of financial account information between tax authorities. The goal of CRS is to combat tax evasion and ensure that taxpayers are paying their fair share of taxes.

- The Controlled Foreign Corporation (CFC) Rules: CFC rules are designed to prevent corporations from using low-tax jurisdictions to avoid paying taxes in their home country. CFC rules require corporations to pay taxes on income earned in a foreign subsidiary, even if that income is not repatriated back to the home country.

- The Digital Services Taxes (DST): DST is a new form of tax that is being introduced by many countries to tax digital companies that have a significant presence in their country. The goal of DST is to ensure that these companies are taxed fairly and that they are paying their fair share of taxes.

These international tax law changes are designed to ensure that multinational corporations are paying their fair share of taxes and to prevent aggressive tax planning. These changes may have a significant impact on the bottom line of these corporations and could result in a reduction in their profits.

Impact of COVID-19 on Tax Laws


The COVID-19 pandemic has had a significant impact on tax laws around the world. Governments are looking for ways to provide economic relief to individuals and businesses that have been affected by the pandemic. Some of the key changes to tax laws that have been introduced in response to COVID-19 include:

- Economic Impact Payments (EIPs): The United States government introduced EIPs to provide financial relief to individuals and families affected by the pandemic. The payments were based on income, and many people received up to $1,200.

- Tax Filing and Payment Extensions: Many countries have extended the tax filing and payment deadlines to provide relief to individuals and businesses that are struggling financially due to the pandemic.

- Tax Relief for Businesses: Governments have introduced various tax relief measures to support businesses affected by the pandemic. Some of the measures include tax credits, deferrals, and exemptions.

- Increased Funding for Healthcare: Governments around the world have increased funding for healthcare to tackle the pandemic. This funding has been raised through various sources, including taxes.

The impact of COVID-19 on tax laws has been significant. Governments are looking for ways to provide economic relief to individuals and businesses that have been affected by the pandemic, while also ensuring that there is enough funding for public goods and services, such as healthcare.

Conclusion


Tax laws are an essential aspect of any country's economic structure. They are used to fund public goods and services and regulate the flow of funds in the economy. Recent attention and changes to tax laws have been significant, with many countries looking to prevent tax evasion and aggressive tax planning by multinational corporations. The COVID-19 pandemic has also had a significant impact on tax laws, with governments introducing various tax relief measures to support individuals and businesses affected by the pandemic. Moving forward, it is essential to ensure that tax laws are fair, equitable, and support the overall economy's growth and development.

In the 1997, the Taxpayer relief Act allowed many taxpayers to enjoy tax breaks that were not previously available to investors. For example, before that Act, taxpayers were forced to pay a high percentage of capital gain taxes on property that was sold for profit. Now, investors are allowed to make a certain profit, $250,00 per individual, and avoid paying capital gain taxes. Taxpayers can even take advantage of that rule more than one time in their lifetime. Previously, tax payers could only enjoy a tax break like that, once during their lifetime. The Taxpayer Relief Act of 1997, allowed for many changes in tax laws, including large reductions in capital gains taxes for many individuals.

The inheritance tax is set to expire this year, which effectively allows individuals to inherit without paying taxes. In fact, the sunset provision which covered the previous Taxpayer Relief Act, is set to expire in 2010. A Bill that would have continued that tax relief, and other tax laws, failed to pass in 2007. Although an additional Bill was introduced in 2009, it has not yet passed and is currently under review. As it stands now, many taxes are set to rise unless some action is taken on a Bill that would extend tax breaks, or create new ones. If no new changes take effect, the capital gains tax rate will revert to what it was before the Tax Relief Act went into effect.

Rates that remain in effect through 2010, because of the Tax Reconciliation Act, will expire at the end of the year. In essence, Capitol gain taxes are set to increase significantly. After 2010, short term investments, will be taxed at a capital gains tax rate that matches an individuals income tax rate. That rate can be as high as almost forty percent.

Long term investments will  generally have a capital gains tax rate of around twenty percent. In addition, investments that are not sold for at least five years, will be taxed at a lower rate then other long term investments. Yet, the capital gains tax rate is generally on a few percentage points lower. Investors that have properties that are extremely valuable, may enjoy added benefits from holding onto their investments for longer than five years.

The state of the economy in the United States, has forced many individuals to focus on tax laws. Many families are making great efforts to save money in every area possible. Unfortunately, some investors are not aware of the recent changes that are likely to take effect within capital gain tax rates. Especially now, small changes in the way investors sell their property, can have a big impact on their capital gains tax rate. In fact, investors can enjoy a significant savings if they become knowledgeable on the many changes taking place with capital gain taxes.