Lower Individual Rates

OB3-60 16

Single taxpayers (standard return, no credits) **

2026 Taxes if TCJA had expired 2026 Tax Brackets Under OBBB

$0 – 13,900 No tax $0 - 16,100 No tax $13,901 - 26,400 10% $16,101 - 28,500 10%

$26,401 - 64,650 15% $28,501 - 66,500 12% $64,651 - 136,850 25% $66,501 - 121,800 22% $136,851 - 270,300 28% $121,801 - 217,875 24%

$270,301 - 571,350 33% $217,876 - 272,325 32% $571,351 - 573,650 35% $272,326 - 656,700 35% $573,651+ 39.6% $656,701+ 37%

Married Joint Filers (standard return, no credits) ***

If TCJA had expired Permanent Tax Rates Under OBBB

$0 - 27,800 No tax $0 - 32,200 No tax

$27,801 – 52,800 10% $32,201 – 57,000 10% $52,801 – 129,300 15% $57,001 - 133,000 12% $129,301 – 232,600 25% $133,001 - 243,600 22%

$232,601 – 340,000 28% $243,601 - 435,750 24% $340,001 – 585,300 33% $435,751 - 544,650 32% $585,301 – 657,500 35% $544,651 - 800,900 35%

$657,501+ 39.6% $800,901+ 37% OB3-60 17

Background

TCJA reduced individual tax rates and adjusted tax brackets such that the vast majority of taxpayers received tax cuts regardless of their income. The small number of individual taxpayers who paid more taxes as a result of TCJA were primarily high-income taxpayers who had claimed high amounts of itemized deductions. TCJA eliminated and capped many itemized deductions, moving toward lower tax rates and a broader base. TCJA also streamlined the standard deduction-personal exemption system by suspending personal exemptions but more than made up for it by nearly doubling the standard deduction and increasing the Child Tax Credit. These changes were scheduled to expire after 2025.

What OBBB Did

• Ensured that taxpayers at all income levels avoided a tax hike in 2026.
• Made permanent TCJA’s changes to tax rates, brackets, the standard deduction, and personal exemptions.
• Built on TCJA’s nearly doubled standard deduction by adding further to it.

Big Beautiful Bill Extended Lower Tax Rates Across

Incomes

Why It Matters?

• The tax code remains highly progressive, with high-income individuals paying a larger share of their incomes in taxes than low-income Americans (see chart).
• High marginal tax rates discourage work and entrepreneurship.
• OBBB’s reductions in tax rates represent a tax cut of about $2.2 trillion over nine years (2026-34).
• This reform also reduces taxes for small businesses that file as pass-throughs.

Where Can I Find the Changes? OBBB Section 70101-70103; 26 U.S.C. § 1(f), 63(j), 151(d).