Rev. Proc. 2024-40 — Tax Year 2025 Adjustments
In EffectPublished October 2024. Sets inflation-adjusted thresholds for tax year 2025 (returns filed in 2026). IRS announcement
Standard Deductions
| Filing Status | 2025 Amount |
|---|---|
| Single / Married Filing Separately | $15,000 |
| Married Filing Jointly | $30,000 |
| Head of Household | $22,500 |
2025 Tax Brackets (Single)
| Rate | Taxable Income |
|---|---|
| 10% | Up to $11,925 |
| 12% | $11,926 - $48,475 |
| 22% | $48,476 - $103,350 |
| 24% | $103,351 - $197,300 |
| 32% | $197,301 - $250,525 |
| 35% | $250,526 - $626,350 |
| 37% | Over $626,350 |
Other 2025 Figures
- Maximum EITC (3+ children): $8,046
- Annual gift tax exclusion: $19,000 per recipient
- Estate and gift tax exclusion: $13,990,000
- Social Security wage base: $176,100
- Long-term capital gains 0% threshold (single): up to $48,350
- Long-term capital gains 15% threshold (single): $48,351 to $533,400
IRS Notice 2024-80 — 2025 Retirement Contribution Limits
In EffectPublished November 2024. Sets contribution limits for retirement accounts for tax year 2025.
- 401(k), 403(b), most 457 plans: $23,500
- Catch-up contribution (age 50-59, 64+): $7,500
- SECURE 2.0 enhanced catch-up (age 60-63): $11,250
- Traditional and Roth IRA: $7,000
- IRA catch-up (age 50+): $1,000 (not inflation-adjusted)
- SIMPLE IRA: $16,500
Rev. Proc. 2025-32 — Tax Year 2026 Adjustments (including OBBBA)
Tax Year 2026Published fall 2025. Sets inflation-adjusted thresholds for tax year 2026 (returns filed in 2027), incorporating amendments from the One Big Beautiful Bill Act (OBBBA). IRS announcement
Standard Deductions (2026)
| Filing Status | 2026 Amount |
|---|---|
| Single / Married Filing Separately | $16,100 |
| Married Filing Jointly | $32,200 |
| Head of Household | $24,150 |
Other 2026 Figures
- Estate and gift tax exclusion: $15,000,000 (OBBBA increase from $13,990,000)
- Annual gift tax exclusion: $19,000 (unchanged)
- AMT exemption phase-out thresholds: modified under OBBBA
IRS Notice 2025-67 — 2026 Retirement Contribution Limits
Tax Year 2026Published November 2025. Sets contribution limits for retirement accounts for tax year 2026.
- 401(k), 403(b), most 457 plans: $24,500 (up from $23,500)
- Catch-up contribution (age 50+): $8,000 (up from $7,500)
- Traditional and Roth IRA: $7,500 (up from $7,000)
- SIMPLE IRA: $17,000 (up from $16,500)
One Big Beautiful Bill Act (OBBBA) — Legislative Provisions
Enacted (verify final rules)The OBBBA passed the House in May 2025 and was incorporated into Rev. Proc. 2025-32. Some provisions are subject to implementing regulations that may refine the details below. Calculators modeling OBBBA provisions should be treated as projections.
- No tax on tips: Deduction for qualified tip income reported on W-2 Box 7. Applies to service industry employees. Income phase-out thresholds not yet finalized in published IRS guidance.
- No tax on overtime: Deduction for overtime compensation paid at 1.5x regular rate per FLSA. Income phase-out thresholds not yet finalized in published IRS guidance.
- SALT cap increase: Proposed increase from $10,000 to $40,000 for filers below an income threshold. Final income limit may vary from calculator projections.
- Estate exclusion increase: Confirmed at $15,000,000 per person for 2026, per Rev. Proc. 2025-32.