Finance
This is how tax brackets could change during Donald Trump's presidency: Here's how it would affect your pockets
One of Donald Trump’s campaign promises was to extend tax cuts enacted in his first term which will expire at the end of next year if no action is taken.
The last time Donald Trump was president, in 2017, he and the Republican-controlled Congress passed the Tax Cuts and Jobs Act (TCJA) that gave a tax break to nearly every American. However, that legislation will sunset after 2025 and with it several provisions like the standard deduction and tax brackets.
While he is returning to Washington with Republicans in control of both chambers on Capitol Hill when the 119th Congress is sworn in, there is the possibility that Americans could see their taxes go up in 2026. Getting massive legislation like the TCJA can be a long, hard slog.
The Tax Foundation, a Washington DC-based think tank, estimates that if the changes to the TCJA go away, that over 60% of taxpayers would see their taxes go up in 2026. Here’s a look at how the tax brackets and standard deductions would look if the TCJA is not extended.
This is how tax brackets could change during Donald Trump’s presidency: Here’s how it would affect your pockets
Currently, there are seven individual income tax brackets. That would not change, but the rates would increase for five of those in 2026 without an extension of the TCJA. Here are what the new rates would be in 2026 compared to the current rates:
| Individual income thresholds for 2025 | TCJA | Pre-TCJA | ||
|---|---|---|---|---|
| 1 | Incomes of $11,925 or less | 10.0% | 10.0% | |
| 2 | Incomes over $11,925 | 12.0% | 15.0% | |
| 3 | Incomes over $48,475 | 22.0% | 25.0% | |
| 4 | Incomes over $103,350 | 24.0% | 28.0% | |
| 5 | Incomes over $197,300 | 32.0% | 33.0% | |
| 6 | Incomes over $250,525 | 35.0% | 35.0% | |
| 7 | Incomes over $626,350 | 37.0% | 39.6% |
The standard deduction is nearly double what is was before the TCJA. Along with doubling the Child Tax Credit to $2,000 and expanding the phaseout notes that gave a lot of tax payers a hefty amount of their income protected from taxation. However, that came at the cost of eliminating personal exemptions.
Without the TCJA, the personal exemption of $5,300 would return but the standard deduction would revert to the following amounts according to the Tax Foundation for each filing status:
| Filing status | TCJA | Pre-TCJA |
|---|---|---|
| Single filers | $15,450 | $8,350 |
| Joint filers | $30,850 | $16,700 |
| Head of household | $23,150 | $12,250 |
As well, the Child Tax Credit would phase out for single filers with incomes of $75,000 and joint filers earning $110,000 as opposed to the current $200,000 and $400,000, respectively.
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