OBBB 2026 vs 2025 Tax Comparison

The One Big Beautiful Bill Act (OBBB, P.L. 119-21, signed July 4, 2025) extended most TCJA provisions through 2026 and beyond. Key extensions: standard deduction, lower marginal rates, $2,000 Child Tax Credit, $10k SALT cap (with some modifications), and the estate exemption was RAISED to $15M for 2026 (not halved as feared). Source: IRS OBBB Pages, JCT Analysis.

What OBBB Kept From TCJA

Extended: lower marginal rates (10/12/22/24/32/35/37 instead of pre-TCJA 10/15/25/28/33/35/39.6), higher standard deduction ($15k single / $30k MFJ for 2026), $2,000 Child Tax Credit with $1,700 refundable portion, $10k SALT cap, pass-through 20% QBI deduction, and current AMT exemption levels. These were set to sunset Dec 31, 2025 but are now permanent or extended through 2028+.

What OBBB Changed

(1) Estate exemption RAISED to $15M (was $13.99M for 2025, was scheduled to halve to ~$7M under TCJA sunset). (2) State and Local Tax (SALT) cap modified to $40k for households under $500k AGI (still $10k above). (3) Senior bonus deduction $4,000 for 65+. (4) Tip and overtime income deduction up to $25,000/year (small businesses). (5) Section 199A QBI deduction extended permanently.

What OBBB Did Not Address

OBBB did not repeal the 3.8% Net Investment Income Tax (still applies above $200k single / $250k MFJ). It did not eliminate the Alternative Minimum Tax (AMT exemption still phases out for very high earners). It did not extend the SALT workaround for Pass-Through Entity Tax (PTET) — most states still offer this separately. SALT cap remains binding for high-tax-state residents above $500k AGI.

Last updated May 2026. Sources: IRS — OBBB Pages, JCT OBBB Analysis, P.L. 119-21 Full Text.