OBBB vs TCJA 2026 Tax Bracket Comparison
The One Big Beautiful Bill (P.L. 119-21, signed July 4, 2025) made TCJA brackets permanent for 2026 and beyond. Compare your 2026 tax under OBBB permanent rates vs what you would have paid under the expired pre-TCJA brackets.
What OBBB Changed — Making TCJA Permanent for 2026
The Tax Cuts and Jobs Act of 2017 (TCJA) dramatically restructured the individual income tax: it lowered the top rate from 39.6% to 37%, consolidated brackets, nearly doubled the standard deduction, and doubled the child tax credit. However, the individual provisions were temporary — set to expire ("sunset") on December 31, 2025. Without Congressional action, 2026 rates would have reverted to pre-2018 law.
The One Big Beautiful Bill (OBBB, P.L. 119-21, signed July 4, 2025) permanently extended these TCJA provisions. The 10/12/22/24/32/35/37% bracket structure is now permanent law, indexed for inflation going forward. The 2026 standard deduction is $15,000 (single) / $30,000 (MFJ). The pre-TCJA brackets of 10/15/25/28/33/35/39.6% are permanently retired. Source: irs.gov, congress.gov/119/plaws. Last updated: May 2026.
2026 Tax Brackets Under OBBB vs Pre-TCJA Comparison (Single Filer)
| Income Range (Single) | OBBB 2026 Rate | Pre-TCJA Hypothetical Rate | Rate Difference |
|---|---|---|---|
| $0 – $11,925 | 10% | 10% | Same |
| $11,925 – $48,475 | 12% | 15% | −3% |
| $48,475 – $103,350 | 22% | 25% | −3% |
| $103,350 – $197,300 | 24% | 28% | −4% |
| $197,300 – $250,525 | 32% | 33% | −1% |
| $250,525 – $626,350 | 35% | 35% | Same |
| Above $626,350 | 37% | 39.6% | −2.6% |
Pre-TCJA hypothetical brackets are inflation-adjusted to 2026 income levels using CBO projections. Most taxpayers see the biggest benefit in the 12% vs 15% and 22% vs 25% bracket differences — these affect middle-income households most directly. Source: IRS Revenue Procedure 2025-40, Tax Foundation analysis.
Key OBBB Provisions Beyond Tax Brackets
Beyond the brackets themselves, OBBB permanently extended several other TCJA features: (1) Standard deduction — $15,000 single / $30,000 MFJ in 2026 (vs hypothetical $7,800/$15,600 under pre-TCJA); (2) Child Tax Credit — $2,000 per child permanently (vs $1,000 pre-TCJA); (3) Section 199A QBI deduction — 20% pass-through deduction permanently extended; (4) Estate tax exemption — raised to $15 million per person (vs scheduled halving to ~$7M); (5) Alternative Minimum Tax (AMT) exemption — higher exemption thresholds retained. The combined effect for most middle-income households is a tax reduction of $2,000–$8,000 per year compared to what pre-TCJA reversion would have produced. Source: irs.gov/newsroom.
Frequently Asked Questions
What is the One Big Beautiful Bill (OBBB) and how does it affect 2026 taxes?
The One Big Beautiful Bill Act (P.L. 119-21) was signed into law on July 4, 2025. It made the TCJA provisions permanent, including the 2017 individual tax brackets, standard deductions, and child tax credits that were set to expire after December 31, 2025. Without OBBB, tax rates would have reverted to higher pre-2018 brackets. Source: congress.gov, irs.gov.
What would happen without OBBB — what would 2026 rates have been?
Without OBBB, the TCJA sunset would have restored pre-2018 tax law for 2026: seven brackets with top rate 39.6% (vs 37%), reduced standard deduction, lower child tax credit ($1,000 vs $2,000). The Tax Foundation estimated a typical middle-income household would pay $1,500-$3,000 more per year under pre-TCJA rates.
Are the TCJA tax brackets now permanent after OBBB?
Yes. OBBB (P.L. 119-21, signed July 4, 2025) made the TCJA individual income tax provisions permanent. The 10%, 12%, 22%, 24%, 32%, 35%, and 37% brackets are now permanent law, indexed for inflation. The pre-TCJA brackets of 10%, 15%, 25%, 28%, 33%, 35%, and 39.6% are no longer scheduled to return. Source: irs.gov.
What changed in the standard deduction under OBBB?
OBBB made the TCJA's enhanced standard deduction permanent: $15,000 single / $30,000 MFJ for 2026 (inflation-adjusted), up from the pre-TCJA $6,350/$12,700. These higher standard deductions mean fewer taxpayers benefit from itemizing. Source: IRS Rev. Proc. 2025-40.
Does OBBB affect the Child Tax Credit?
Yes. OBBB made the TCJA Child Tax Credit of $2,000 per qualifying child permanent (vs the pre-TCJA $1,000). OBBB also increased the refundable portion (Additional Child Tax Credit) and adjusted the income phaseout thresholds. Source: IRS.gov/childtaxcredit.