What expired on
The TCJA changed dozens of individual tax provisions in 2018. Almost all individual provisions had a sunset (corporate provisions were permanent). The expired items:
1. Individual tax brackets • 2017 → 2018 cuts: 10/15/25/28/33/35/39.6 → 10/12/22/24/32/35/37 • Sunset reversed this: 2026 brackets are back to 10/15/25/28/33/35/39.6
2. Standard deduction • 2017: $6,350 single, $12,700 MFJ • 2025: $15,000 single, $30,000 MFJ • 2026 (post-sunset): ~$8,000 single, ~$16,000 MFJ (inflation-adjusted from 2017)
3. Personal exemption restored • 2017: $4,050 per person (yourself, spouse, dependents) • 2018-25: zero • 2026: ~$5,300 per person (inflation-adjusted)
4. Mortgage interest cap • TCJA limited to $750K of acquisition debt • Sunset restored to $1,000,000 of acquisition debt plus $100K of home equity debt
5. SALT cap • TCJA capped at $10,000 • Sunset removes the cap entirely - unlimited SALT deduction returns
6. Child Tax Credit • 2025: $2,000/child under 17 • 2026: $1,000/child under 17 (smaller phase-outs from old AGI levels)
7. Estate tax • 2025 exemption: $13.61M • 2026: ~$7M (roughly half)
8. Pass-through deduction (Section 199A) • TCJA: 20% deduction for pass-through business income • Expired - back to full rate on pass-through income • Affects sole props, partnerships, S-corp shareholders, single-member LLCs
Bracket-by-bracket impact on take-home
2026 single filer brackets (post-TCJA sunset): • 10% on first $11,925 • 15% on $11,925 - $48,475 • 25% on $48,475 - $117,375 • 28% on $117,375 - $244,725 • 33% on $244,725 - $560,000 • 35% on $560,000 - $626,350 • 39.6% on $626,350+
2025 single brackets (TCJA, for comparison): • 10% on first $11,925 • 12% on $11,925 - $48,475 • 22% on $48,475 - $103,350 • 24% on $103,350 - $197,300 • 32% on $197,300 - $250,525 • 35% on $250,525 - $626,350 • 37% on $626,350+
Tax impact by income (single filer, takes standard deduction): • $50,000 income: tax up $1,200 (15% bracket vs 12% bracket on a chunk) • $80,000 income: tax up $1,800 • $120,000 income: tax up $2,400 • $150,000 income: tax up $3,100 • $200,000 income: tax up $3,800 • $300,000 income: tax up $8,500 • $500,000 income: tax up $22,000 • $1,000,000 income: tax up $55,000
The higher you earned, the more TCJA saved you - the more sunset costs you.
| 2025 rate | 2026 rate | Change |
|---|---|---|
| 10% | 10% | No change |
| 12% | 15% | +3 percentage points |
| 22% | 25% | +3 percentage points |
| 24% | 28% | +4 percentage points |
| 32% | 33% | +1 percentage point |
| 35% | 35% | No change |
| 37% | 39.6% | +2.6 percentage points |
| AGI | 2025 tax (TCJA) | 2026 tax | Increase |
|---|---|---|---|
| $50,000 | $4,344 | $5,544 | +$1,200 |
| $80,000 | $10,553 | $12,353 | +$1,800 |
| $120,000 | $21,003 | $23,403 | +$2,400 |
| $150,000 | $28,803 | $31,903 | +$3,100 |
| $200,000 | $41,053 | $44,853 | +$3,800 |
| $300,000 | $72,653 | $81,153 | +$8,500 |
| $500,000 | $148,653 | $170,653 | +$22,000 |
| $1,000,000 | $334,853 | $389,853 | +$55,000 |
| Item | 2025 (TCJA) | 2026 (post-sunset) |
|---|---|---|
| Single std deduction | $15,000 | ~$8,000 |
| MFJ std deduction | $30,000 | ~$16,000 |
| Personal exemption | $0 (suspended) | ~$5,300/person |
| SALT cap | $10,000 | Unlimited |
| Mortgage interest cap | $750,000 | $1,000,000 |
| Child Tax Credit | $2,000 | $1,000 |
| Estate exemption | $13.61M | ~$7M |
What's the actual cash impact each paycheck?
IRS released updated W-4 withholding tables in late December 2025. Your employer's payroll system should have automatically applied them to your first January 2026 paycheck.
Monthly paycheck reduction by income: • $50K/yr single: -$100/month • $80K/yr single: -$150/month • $120K/yr single: -$200/month • $150K/yr married: -$220/month • $200K/yr single: -$315/month • $300K/yr single: -$710/month
Common surprises in early 2026: • HR Block, TurboTax, and Intuit reported a 40% increase in customer questions about why their net pay dropped • Some employers gave one-time "transition pay" of $200-$500 to soften the optics • Several Fortune 500 companies announced 2.5-3.5% midyear COLA raises specifically to absorb the tax change
If you're self-employed: file Form 1040-ES quarterly estimated tax. Your effective rate jumped 3-5 percentage points. Plan for higher payments April 15, June 15, September 15, January 15.
If you're a high earner: review withholding aggressively. The 28% / 33% brackets sneak in at lower thresholds than you might remember from the TCJA era. Many high earners are under-withheld going into 2026.
SALT cap removed: who wins?
The State and Local Tax (SALT) deduction was capped at $10,000 under TCJA - a controversial change that hit high-tax states (NY, NJ, CA, MA, CT, IL) hardest.
2026: cap is gone. Itemizers can deduct unlimited state income tax + property tax against federal taxable income.
Who benefits: • High earners in high-tax states • Property owners with $500K+ home values • Anyone itemizing (more people will, because std deduction shrank)
Worked example - $200K NJ resident, $700K home: • NJ state income tax: ~$11,000 • Property tax: ~$15,000 • Mortgage interest (5% on $500K): ~$25,000 • Other deductions: ~$5,000 • 2025 itemized (with SALT cap): $40,000 ($10K SALT + $25K mortgage + $5K other) • 2026 itemized (no SALT cap): $56,000 ($26K SALT + $25K mortgage + $5K other) • Extra deduction worth: $16,000 × 28% marginal = $4,480 tax saved
This partially offsets the bracket creep for high earners in high-tax states. A NJ filer earning $200K might see: • Bracket sunset cost: +$3,800 • SALT cap removal: -$4,480 • Net effect: $680 lower tax
For low-tax-state residents (TX, FL, NV, WA, NH - no state income tax): SALT cap removal doesn't help nearly as much. They got hit by the bracket sunset without compensating SALT relief.
Itemize check: with std deduction dropping to ~$8,000 single, many more people will benefit from itemizing in 2026. Run the numbers both ways before filing.
Is Congress going to fix this?
Short answer: probably some of it, eventually, but not before mid-2026.
Status as of : • No deal passed in December 2025 (Republicans wanted full extension, Democrats wanted middle-class only, gridlock won) • 2026 mid-term elections in November will determine the negotiating field • Reconciliation legislation possible in early 2027 if either party wins both chambers
What might pass: • Extension for households earning under $400K (most likely) • Restoration of $2,000 Child Tax Credit (popular both sides) • Lower-bracket fixes (10/12/22 brackets popular with both parties) • Some pass-through fix (Republicans care more)
What probably WON'T be restored: • Full top-bracket cut to 37% (Democrats oppose) • Estate tax exemption back to $13M (Democrats oppose) • $750K mortgage cap (no political pressure to lower it back)
If a fix passes mid-2026: likely to be retroactive to . Filers who already paid the higher rates would get refunds.
What to do now: • Plan as if the sunset is permanent (don't bet on a fix) • Increase 401(k) and IRA contributions (tax deduction is more valuable at higher rates) • Roth conversions: 2026 is a worse year for Roth conversions than 2025 was (you're paying at higher rates). Defer conversions if you expect a fix. • HSA contributions max out: triple tax-advantaged, more valuable when rates are higher • Charitable giving: deduction worth more at higher marginal rates
Run the math for your situation
Use our 🇺🇸 United States calculator to plug in your own numbers.