Every year, the IRS updates tax brackets to keep pace with inflation and prevent “bracket creep.” Because, let’s be real — nothing’s more frustrating than a small raise pushing you into a higher tax rate, even though your buying power hasn’t actually increased.

For 2026, thresholds have risen about 2.7%, meaning more of your hard-earned cash stays in your pocket. In other words, earning a little more doesn’t automatically mean paying a lot more. 💰

These changes affect federal income taxes, standard deductions, and long-term capital gains rates, so now is a good moment to check where you stand.

Whether you’re a salaried professional, a retiree keeping an eye on investments, or just curious about your paycheck next year, knowing the new brackets helps you plan smarter and avoid surprises later on. 🧾

For 2026, here’s how federal income tax brackets look for single filers:

Married couples filing jointly get roughly double these ranges, while heads of household fall somewhere in between. Remember, these brackets only apply to taxable income — your total income minus deductions and exemptions.

Long-term capital gains (profits from investments held over a year) also got some love. The 0% rate now applies to taxable income up to:

Above that, gains move into the 15% bracket, and the top 20% applies to very high earners — generally those with taxable income above $553,850 for singles and $622,050 for joint filers.

Short-term gains (less than a year), as usual, are still taxed as ordinary income.

Pro tip: Timing matters. Selling strategically to maximize 0% or 15% brackets, harvesting losses to offset gains, or planning retirement withdrawals can keep more of your profits in your pocket.

Knowing the 2026 tax brackets isn’t just trivia — it’s a tool to keep more of your money working for you. 💵

Higher thresholds and boosted deductions mean modest raises won’t automatically hike your taxes, and more investors can benefit from the 0% long-term gains rate.

But note that even small missteps (like forgetting about income from bonuses, side hustles, or investments) can automatically push you into higher brackets and reduce the cash in your wallet. 

So, review your projected 2026 income, double-check deductions, and consider strategies like timing capital gains or retirement contributions. As always, consulting a financial planner can be useful if you feel overwhelmed.

A little planning now can save hundreds or even thousands of dollars and give you less stress come April. 💸