One Big Beautiful Bill Act 2026 Changes

As we welcome 2026, it's essential to note that the One Big Beautiful Bill Act introduces several changes that may affect you, including modifications to standard deductions and charitable deductions.

 

Standard Deduction

Under the One Big Beautiful Bill Act, the standard deduction might impact your upcoming tax filing. [1]

The updated standard deduction amounts for 2026 will be:

• $32,200 for married filing jointly
• $24,150 for head of household
• $16,100 for single or married filing separately

 

Charitable Giving

Don’t itemize? In 2026, you can deduct cash donations to charity. [2]

You can deduct up to:

• $1,000 if filing single
• $2,000 if married filing jointly

Donations must be made in cash and sent to qualified organizations. This is a new option for giving back while managing taxable income without requiring itemization.

 

Child Tax Credit

The One Big Beautiful Bill Act increases the Child Tax Credit to $2,200 per eligible child. [3]

Other updates to the Child Tax Credit include:

• The credit will be adjusted for inflation in future years.
• A valid Social Security number is required for the child.
• For joint filers, at least one spouse must have a valid SSN.

These updates aim to clarify eligibility and streamline administration.

 

New Deductions for Tips and Overtime

Starting in 2026, eligible taxpayers may deduct:

• Up to $25,000 in reported tips
• Up to $12,500 in overtime compensation ($25,000 if married filing jointly)

These deductions phase out for higher-income taxpayers. [4]

 

Energy Tax Credits Phase Out

Thinking about solar, EVs, or energy-efficient upgrades?

Several energy tax credits expire under the One Big Beautiful Bill Act, including [5]:

• Clean vehicle credit
• Residential clean energy credit
• Energy-efficient home improvement credit

The IRS has published FAQs to help with eligibility and phase-out timelines.