Big changes are coming to your tax bill in 2026, and they’re mostly good news! The One Big Beautiful Bill Act (OBBBA) brings significant updates that could save the average household about $2,900 annually. Whether you’re a homeowner trying to maximize your deductions or a small business owner looking to streamline operations, these changes will impact your bottom line. Brick Taxes LLC is here to ensure all credits and deductions are properly applied.
Let’s break down exactly what you need to know to prepare for tax season 2026.
Major Wins for Homeowners
Standard Deduction Gets a Boost
The standard deduction is getting a substantial increase across all filing categories. Here’s what you can claim in 2026:
- Married filing jointly: $32,200 (up $1,500 from 2025)
- Single filers: $16,100
- Head of household: $24,150
If you’re 65 or older, you get an extra bonus. Senior filers can add $2,000 to their standard deduction if single, or $1,600 per spouse if married filing jointly. This means many homeowners might find it more beneficial to take the standard deduction rather than itemizing.
SALT Deduction Cap Quadruples
Here’s the game-changer for homeowners in high-tax states. The state and local tax (SALT) deduction cap jumps from $10,000 to $40,000 for households earning up to $500,000. This includes:
- Property taxes on your primary residence
- State income taxes
- Other qualifying local taxes
The cap increases by 1% annually through 2029, then reverts to $10,000 in 2030. If you live in states like California, New York, or New Jersey, this change alone could save you thousands.
New Car Loan Interest Deduction
Starting in 2026, you can deduct up to $10,000 annually in interest on new personal vehicle loans through 2028. This applies to cars, trucks, and SUVs purchased for personal use. However, this benefit phases out for higher earners:
- Single filers: Phase-out begins at $100,000 MAGI
- Married filing jointly: Phase-out begins at $200,000 MAGI
Small Business Owners Hit the Jackpot
Simplified 1099 Reporting
Say goodbye to mountains of 1099 forms. The threshold for issuing 1099-NEC and 1099-MISC forms increases from $600 to $2,000 in 2026. This means:
- Less paperwork for your business
- Fewer forms to track and mail
- Reduced administrative burden
You should still track all payments internally, but you’ll only need to issue forms for contractors paid $2,000 or more annually.
Permanent QBI Deduction
The 20% qualified business income (QBI) deduction becomes permanent under the new law. This allows eligible small business owners to deduct up to 20% of their qualified business income, significantly reducing taxable income for:
- Sole proprietorships
- Partnerships
- S-corporations
- Some LLCs
Enhanced Stock Gain Exclusions
If you’re planning to sell qualified small business stock, the exclusion limit increases from $10 million to $15 million per taxpayer. This expansion makes it more attractive for entrepreneurs to invest in and eventually sell small business stock.
Employee Benefit Deductions Made Permanent
Several valuable employee benefit deductions become permanent, helping with recruitment and retention:
- Student loan assistance: Employer contributions to employee student loans remain deductible
- Tip income deductions: Up to $25,000 annually for businesses in tipping industries
- Overtime compensation deductions: Up to $12,500 for overtime pay
Business Vehicle Interest Deduction
Small business owners can also take advantage of the new vehicle interest deduction for cars, trucks, and equipment used in business operations. The same $10,000 annual limit and income phase-out rules apply.
Timeline and Implementation
Most of these changes take effect for the 2025 tax year, which means you’ll see the benefits when you file your 2026 tax return. However, some provisions have specific timelines:
- Vehicle interest deduction: Available through 2028
- SALT cap increases: Phase up 1% annually through 2029, then revert to $10,000
- QBI deduction: Made permanent
- 1099 threshold: Effective for 2026 tax year
Brick Taxes LLC is here to ensure the proper refund is returned to YOU!
What This Means for Your Tax Strategy
For Homeowners:
- Run the numbers on itemizing vs. standard deduction with the new higher amounts
- If you’re in a high-tax state, itemizing might now make sense with the higher SALT cap
- Consider timing major purchases or renovations to maximize deductions
- If you’re car shopping, factor in the interest deduction benefit
For Small Business Owners:
- Review your contractor payment tracking systems
- Consider how the permanent QBI deduction affects your business structure decisions
- Evaluate employee benefit packages with new permanent deductions in mind
- Plan vehicle purchases with the interest deduction in mind
Planning Ahead
While these changes bring significant benefits, tax planning remains crucial. The landscape will continue evolving, and what works best for your situation depends on your specific circumstances.
Consider these steps:
- Review your current tax withholdings and estimated payments
- Evaluate whether your current business structure still makes sense
- Document expenses that qualify for new deductions
- Stay informed about implementation details as they’re released
Get Professional Help
Tax law changes can be complex, and the best strategy varies by individual situation. These updates represent some of the most significant tax changes in recent years, affecting everything from basic deductions to business operations.
Ready to make sure you’re maximizing these new opportunities? The team at Brick Taxes is here to help you navigate these changes and develop a tax strategy that works for your specific situation. We stay on top of the latest updates so you can focus on what matters most – your family and your business.
Contact us today to schedule a consultation and learn how these 2026 tax changes can work in your favor. Don’t leave money on the table when tax season rolls around. SKIP THE CONTACT DELAY and click Signup in the lower right corner of our Client Portal. screen. Choose your
THE FINE DETAILS
The Fine Details can be found in the bill itself
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