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DEDUCTIONS

Eight Tax Deductions Being Changed for the 2026 tax season

Jackson Hewitt

Copywriter

Published on: June 25, 2025

Tax law is constantly evolving and, for the most part, that’s a good thing! However, keeping up with the changes from year to year can be quite a headache, especially when you were counting on a deduction that you suddenly find out no longer exists. To help minimize confusion, we’ve compiled a list of major changes made to tax deductions in the past year.

Changed Deductions and Credits:

  • Standard deduction: The significant increase in the standard deduction can be a big help to taxpayers – for Single and Married Filing Separate taxpayers, the new standard deduction is $15,000; it’s $30,000 for those who are Married Filing Jointly or Qualifying Surviving Spouses; and it’s $22,500 if Head of Household. Due to annual deduction increases, more Americans will claim the standard deduction instead of itemizing, which reduces the paperwork-gathering and record-keeping necessary to itemize deductions.
  • Child Tax Credit: The Child Tax Credit is $2,000 per eligible child, and the maximum income before the credit is phased out is $400,000 if Married Filing Jointly and $200,000 for all other filing statuses. In addition, the refundable portion of the credit, the Additional Child Tax Credit, is now up to $1,700 per eligible child, which is an increase over the previous max credit allowed of $1600. Taxpayers must have an earned income of over $2,500 to be eligible for the Additional Child Tax Credit. The Credit for Other Dependents (ODC) is available for any dependent not eligible for the traditional Child Tax Credit/Additional Child Tax Credits. This is a nonrefundable credit of $500 per dependent. Those eligible for the ODC include children over 16, children in college, and dependent parents.
  • Earned Income Tax Credit: The Earned Income Tax Credit (EITC) maximum credit amounts have increased as have the earned income amounts on which the maximum credit is based. The maximum credit for 4 children is now over $8,000!
Item Number of Qualifying Children
One Two Three or more None
Earned Income Amount $12,730 $17,880 $17,880 $8,490
Max Amount of Credit $4,328 $7,152 $8,046 $649
  • Deductible Adoption Expenses: The credit allowed for adoption of a child with special needs is $17,280 (was $16,810) no matter the actual amount of expenses. The maximum credit allowed for other adoptions is the amount of qualified adoption expenses up to $17,280 (was $16,810).

Other Changes

  • Social Security Tax: The maximum earned income subject to Social Security tax this year rose to $176,100 (was $168,600). Therefore, the maximum Social Security tax on wages is $10,918.20 and on self-employment income is $21,836.
  • Standard Mileage Rates: The standard business mileage rate increased to 70 cents per mile (was 67 cents). The standard mileage rate for medical and moving (available for active-duty members of the military) is 21 cents per mile (no change). The charity mileage rate is set by statute and remains at 14 cents per mile.
  • Self-employed Income Reporting Form: Credit and debit card payments processed through a third-party are reported to self-employed taxpayers on Form 1099-K, Payment Card and Third-Party Network Transactions. For this tax year, the threshold for issuing is $2,500 (was $5,000) no matter how many transactions are processed.
  • IRS Direct File Program: This is a free tax tool individuals may use to file their federal income tax returns directly with the IRS. No one is required to use Direct File, and it does not replace other options for filing.

    This free filing program pilot closed in April 2024. The IRS then announced it will make Direct File a permanent option for filing federal tax returns starting in the 2025 tax season. However, there is some uncertainty about the future of the program beyond the 2025 tax season as staff is reportedly not working on development for the 2026 season.

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