IRS Tax Inflation Adjustments for 2026
I have included the following information in our Find Your Balance Monthly newsletter. Other items covered in our newsletter include: notable calendar dates, a gentle accounting reminder, what’s new from the IRS, getting ready for tax season, staying organized, giving with purpose, 1099s & contractor notes, and my thoughts.
You can come back to reference this as you prepare for tax season and plan for your 2026 taxes.
Standard deduction changes
$32,200 for married couples filing jointly - up by $700
$16,100 for single filers & married filing separately folks - up by $350.
$24,150 for heads of households - up by $525.
Marginal rates
37% for incomes over $640,600 ($768,700 for married filing jointly)
35% for incomes over $256,225 ($512,450 for married filing jointly)
32% for incomes over $201,775 ($403,550 for married filing jointly)
24% for incomes over $105,700 ($211,400 for married filing jointly)
22% for incomes over $50,400 ($100,800 for married filing jointly)
12% for incomes over $12,400 ($24,800 for married filing jointly)
10% for incomes of $12,400 or less ($24,800 for married filing jointly)
IRA contribution changes
$24,500 for individuals contributing to a 401(k), 403(b), 457, & TSP - up by $1,000
For folks who contribute through their employers to an IRA and receive a company match, combined employee and employer contributions cannot exceed $72,000 - up by $2,000.
$7,500 for Traditional or Roth IRA and $8,600 for folks 50 or over.
Other common benefit changes
$4,400 for self-only or $8,750 for family coverage - up by $100 for self-only & $325 for family
$3,400 for FSA - up by $100
Standard mileage rate
January 1 – June 30, 2026
72.5 cents for business miles - up by 2.5 cents
20.5 cents for medical miles – down by .5 cents
20.5 cents for moving miles for qualified active-duty members of the Armed Forces
14 cents for charitable service miles
July 1 – December 31, 2026
76 cents for business miles (mid-year increase due to fuel costs)
23.5 cents for medical miles
23.5 cents for qualified moving miles
14 cents for charitable service miles (unchanged; this rate is set by statute)
Apply each rate only to miles driven in that period. Keep a contemporaneous mileage log. These rates apply to gasoline, diesel, hybrid, and fully electric vehicles. Using the standard rate is optional; actual expenses may be used instead if you have the records.
1099s for contractors and vendors
For payments made in 2026 (the forms you file in early 2027), the federal reporting threshold for Form 1099-NEC and most Form 1099-MISC categories is $2,000, up from $600. Payments made in 2025 were still reported at $600.
That $2,000 amount is the new federal base. It will be adjusted for inflation beginning with payments made in 2027. 2026 stays at $2,000.
This is a payer reporting rule, not a tax cut. Income paid to a contractor is still taxable even if no 1099 is issued. Collect a W-9 before you pay. If backup withholding applies, you file a 1099 regardless of amount. Some 1099 boxes never moved to $2,000 (for example, certain royalties can still be $10). Form 1099-K (PayPal, Stripe, and similar platforms) is a separate threshold and is not this $2,000 rule.
State filing can differ. Some states may still require a 1099 at $600 even when federal does not. Confirm Maryland and any other state you pay into before you skip a form.
Sources:
https://www.irs.gov/newsroom/401k-limit-increases-to-24500-for-2026-ira-limit-increases-to-7500
https://www.irs.gov/tax-professionals/standard-mileage-rates
https://www.irs.gov/publications/p1099
Updated on September 13, 2026