See if Trump’s Tax Cuts Will Change How You File in 2026

The One Big Beautiful Bill Act was signed into law less than six months ago, bringing significant changes to the tax code. As millions of American consumers prepare to file their taxes in early 2026, they will soon discover how the new tax policies impact them.

President Donald Trump’s second-term tax law extended key provisions from the 2017 Tax Cuts and Jobs Act, such as more generous tax brackets and a larger standard deduction. While many of the changes benefit a wide range of taxpayers, there are also specific provisions that cater to select groups, like tipped workers and individuals 65 and older.

According to Brian Schultz, leader of the Plante Moran Wealth Management tax practice, the new tax law introduces more deductions and enhancements, but also adds complexity in terms of eligibility and planning. Taxpayers will need to pay closer attention to their taxes than in previous years.

Here are some of the key changes in the tax code for 2025 and 2026:

New tax breaks for tipped and overtime workers have been introduced, with deductions for tip income and overtime pay. The “no tax on tips” and “no tax on overtime” deductions aim to provide relief for workers in these categories, with eligibility requirements becoming more lenient.

A $6,000 “senior bonus” deduction has been implemented for individuals 65 and older, providing tax relief for Social Security recipients with income below a certain threshold. However, the deduction is not directly tied to Social Security benefits and is available to eligible taxpayers regardless of their Social Security status.

Changes to the 1099-K rules for 2025 and 2026 have been clarified, with the threshold for receiving 1099-K forms remaining at $20,000 and 200 transactions. This ensures that most casual sellers on online platforms do not need to deal with additional paperwork, although they are still responsible for reporting their income.

Other tax rules that have been modified include an increase in the state and local tax (SALT) deduction, a higher child tax credit, the establishment of “Trump Accounts” for children born in specific years, a new car loan interest deduction, and a deduction for charitable gifts.

Overall, the One Big Beautiful Bill Act brings significant changes to the tax landscape for 2025 and 2026, with a mix of broad-based benefits and targeted provisions for specific groups of taxpayers. As individuals prepare to file their taxes, understanding these new policies will be crucial to maximizing their tax savings.