IRS Inflation Adjustments: Official Tax Limits

For 2027, the standard deduction is $16,600 single, $33,200 married filing jointly and $24,925 head of household, and the 37% rate starts above $661,375 single and $793,650 joint. The child tax credit rises to $2,300, the annual gift exclusion to $20,000, the estate exemption to $15,480,000 and the health FSA limit to $3,500. These are the official figures from Rev. Proc. 2026-35, announced in IR-2026-133 on November 5, 2026.

The 2027 amounts apply to income you earn in 2027 and the return you file in 2028. The return you file in early 2027 still uses the 2026 figures from Rev. Proc. 2025-32, which are further down this page: a $16,100 / $32,200 / $24,150 standard deduction and a 37% rate above $640,600 single and $768,700 joint.

This page is the number reference. For the law changes behind the numbers (the senior deduction, the tips and overtime deductions, the higher SALT cap), read the OBBBA tax changes guide.

2027 vs 2026: what changed

All 2027 figures are from Rev. Proc. 2026-35 (section number in the first column). The 2026 column is from Rev. Proc. 2025-32. The IRS indexes these amounts with the chained consumer price index (C-CPI-U) required by 26 U.S.C. §1(f)(3), then rounds each result to the increment its Code section sets (often down to a multiple of $50 or $1,000), which is why some amounts move by $50, the gift exclusion moves by a full $1,000, and a few, like the $350 educator deduction, do not move at all.

Three changes stand out. The annual gift exclusion moves up a full $1,000 step to $20,000 per recipient, its first increase since 2025, so a married couple who split gifts can give $40,000 per recipient in 2027. The AMT exemption phaseout thresholds, held at $500,000 and $1,000,000 for 2026, are indexed again and rise to $515,950 and $1,031,900. And the joint standard deduction ($33,200 = 2 × $16,600) and every joint bracket threshold through the 32% bracket are exactly twice the single amounts, so a bracket-driven marriage penalty only appears once a couple's joint taxable income passes $793,650, where the joint 37% bracket starts well below twice the single threshold ($1,322,750).

2027 federal income tax brackets by filing status

The seven rates stay at 10% to 37%. These are taxable income thresholds (income after the standard or itemized deduction), from section 3.01 of Rev. Proc. 2026-35. "Base tax" is the tax on all income below that bracket, so you apply the bracket's rate only to the amount above its starting point.

Single (2027)

Married filing jointly and qualifying surviving spouse (2027)

Head of household (2027)

Married filing separately (2027)

Estates and trusts (2027)

10% up to $3,400; $340 plus 24% from $3,400 to $12,100; $2,428 plus 35% from $12,100 to $16,500; and $3,968 plus 37% above $16,500. A trust that keeps $20,000 of taxable income owes $3,968 + 37% × $3,500 = $5,263, while a single person with the same taxable income owes $1,280 + 12% × $7,200 = $2,144.

Worked example: what indexing saves in 2027

A single filer with $80,000 of wages and the standard deduction has 2027 taxable income of $80,000 − $16,600 = $63,400. Tax is $5,987 + 22% × ($63,400 − $52,025) = $5,987 + $2,502.50 = $8,489.50. With the 2026 tables the same wages give taxable income of $63,900 and tax of $5,800 + 22% × $13,500 = $8,770, so indexing alone cuts the bill by $280.50.

A married couple with $150,000 of wages has 2027 taxable income of $116,800 and tax of $11,974 + 22% × $12,750 = $14,779, against $15,340 under the 2026 tables: $561 less.

Pick tax year 2027 in the federal tax bracket calculator to run your own taxable income through these tables. The standard deduction calculator, child tax credit calculator, EITC calculator, AMT calculator, QBI deduction calculator, gift tax calculator and FEIE calculator also have a 2027 option. Calculators that depend on figures the IRS has not released yet, such as the paycheck and refund calculators, stay on 2026 for now.

2027 standard deduction for seniors, the blind and dependents

The extra amount is per condition, so a single filer who is both 65 and blind gets $16,600 + $2,100 + $2,100 = $20,800. Someone who can be claimed as a dependent gets the greater of $1,400 or earned income plus $500, capped at the basic amount for their filing status (§3.15 of Rev. Proc. 2026-35).

The $6,000 senior deduction still applies in 2027. The OBBBA deduction of $6,000 per person age 65 or older covers tax years 2025 through 2028, is claimed on Schedule 1-A on top of the standard or itemized deduction, and shrinks by 6% of modified AGI above $75,000 ($150,000 joint). It is not indexed, so it is $6,000 again in 2027. The senior tax deduction guide covers the phaseout in detail.

Example: a married couple, both 65, with $100,000 of pension and IRA income and no Social Security. Their 2027 deductions are $36,600 + $12,000 = $48,600, so taxable income is $51,400 and tax is $2,560 + 12% × ($51,400 − $25,600) = $2,560 + $3,096 = $5,656. Under the 2026 tables they would deduct $35,500 + $12,000 = $47,500, have $52,500 of taxable income and owe $2,480 + 12% × $27,700 = $5,804, so 2027 indexing saves them $148. Check your own case in the senior deduction calculator.

2027 capital gains, AMT and EITC tables

Long-term capital gains and qualified dividends (2027)

These are taxable-income thresholds with gains stacked on top of ordinary income. A married couple with $70,000 of taxable ordinary income in 2027 can realize up to $102,100 − $70,000 = $32,100 of long-term gains at 0%. The 3.8% net investment income tax thresholds ($200,000 single, $250,000 joint) are fixed by statute and do not move. The capital gains calculator applies both layers.

Alternative minimum tax (2027)

The exemption still shrinks by 50 cents per dollar above the threshold, so the single exemption is gone at $515,950 + 2 × $93,000 = $701,950. The 28% rate applies above $252,500 of AMT income after the exemption ($126,250 married filing separately). For a child subject to the kiddie tax, the AMT exemption cannot exceed earned income plus $10,050 (§3.12).

Earned income tax credit (2027)

Investment income above $12,600 in 2027 disqualifies you from the credit entirely.

Other 2027 amounts individuals and small businesses use

Three of these are indexed for the first time. The employer educational assistance exclusion moves from $5,250 to $5,400. The $2,000 information-reporting threshold the OBBBA set for payments made in 2026 rises to $2,100 for payments made in 2027, so a business that pays a contractor $2,050 in 2027 does not have to file a 1099-NEC for it; the 1099 guide for independent contractors explains what still has to be reported. The OBBBA's QSBS caps are indexed for the first time; the QSBS calculator explains how the per-issuer cap works for stock issued after July 4, 2025.

2027 amounts that are not in Rev. Proc. 2026-35

Several limits people expect in this release come from other documents:

The SALT figure is plain arithmetic from the statute: $40,400 × 1.01 = $40,804 and $505,000 × 1.01 = $510,050. The cap still shrinks by 30% of modified AGI above the threshold and cannot fall below $10,000 ($5,000 married filing separately). The full 2027 retirement table (catch-ups, IRA deduction phase-outs, SIMPLE and SEP limits) is in the 401(k) and IRA contribution limits guide.

When the 2027 numbers start to matter

• January 2027 paychecks. Employers withhold federal income tax from 2027 wages using the 2027 withholding tables in Publication 15-T, which the IRS releases around December, so most people see a small take-home increase in their first paycheck of the year. Check your W-4 with the tax withholding calculator if your income changes.
• Open enrollment this fall. The 2027 health FSA ($3,500), HSA ($4,500 / $9,000) and transit ($350 a month) limits apply to elections you make now for next year. The FSA and commuter benefits calculator shows the payroll-tax savings.
• Gifts on or after January 1, 2027. The $20,000 annual exclusion applies to gifts made in calendar 2027. A gift of $20,000 on December 31, 2026 is $1,000 over that year's $19,000 exclusion and needs a Form 709.
• 2027 estimated tax payments. The first one is due April 15, 2027. If you base it on the 2027 brackets, use the tables above, not the 2026 ones.
• The return you file in 2028. Everything above lands on your 2027 Form 1040. The 2026 return you file in early 2027 uses the 2026 amounts below.

2026 amounts at a glance

The 2025 column comes from Rev. Proc. 2024-40 as modified by the OBBBA. The 2025 annual gift exclusion was $19,000, not $18,000 — $18,000 was the 2024 figure. The exclusion did not rise for 2026 because the inflation increase was not large enough to reach the next $1,000 step.

2026 federal income tax brackets by filing status

The OBBBA made the seven TCJA rates permanent. The tables below are taxable income — income after the standard or itemized deduction. "Base tax" is the tax on all income below that bracket, so you only apply the bracket rate to the amount above its starting point.

Single

Married filing jointly and qualifying surviving spouse

Head of household

Married filing separately

Married filing separately uses the single thresholds through the 32% bracket. The 35% bracket runs from $256,225 to $384,350, and the 37% rate applies above $384,350 (base tax $103,291.75).

Estates and trusts

Trusts hit the top rate fast: 10% up to $3,300, 24% to $11,700, 35% to $16,000, and 37% above $16,000.

Worked example: what the bracket shift saves

A single filer with $80,000 of taxable income in both years:

• 2026: $5,800 + 22% × ($80,000 − $50,400) = $5,800 + $6,512 = $12,312
• 2025: $5,578.50 + 22% × ($80,000 − $48,475) = $5,578.50 + $6,935.50 = $12,514

Same income, $202 less tax, purely from indexing. A married couple with $150,000 of wages and the standard deduction sees a larger gap: 2026 taxable income is $117,800 and tax is $11,600 + 22% × $17,000 = $15,340; in 2025 taxable income was $118,500 and tax was $11,157 + 22% × $21,550 = $15,898 — a $558 difference. Run your own numbers in the federal tax bracket calculator, or put these brackets into a spreadsheet with the free sheet in income tax calculation in Excel.

To turn these 2026 numbers into your own refund or balance due, use the tax refund calculator.

2026 standard deduction, including age 65+ and blind amounts

The extra amount is per condition, so a single filer who is both 65 and blind adds $4,100: $16,100 + $2,050 + $2,050 = $20,200. A married couple who are both 65 add $3,300: $32,200 + $1,650 + $1,650 = $35,500.

Dependents: if someone can claim you as a dependent, your standard deduction is the greater of $1,350 or your earned income plus $450, capped at the regular amount for your filing status.

The separate senior deduction: the OBBBA added a $6,000 deduction per person age 65 or older for 2025 through 2028. It is claimed on Schedule 1-A, stacks on top of the table above, works whether or not you itemize, and phases out by 6% of modified AGI above $75,000 ($150,000 joint). The couple above, with MAGI under $150,000, would deduct $35,500 + $12,000 = $47,500 in total. Compare scenarios in the standard deduction calculator and the senior deduction calculator.

2026 long-term capital gains and qualified dividend brackets

These thresholds apply to total taxable income, with gains stacked on top of ordinary income. The 3.8% net investment income tax is separate and its thresholds — $200,000 single, $250,000 joint, $125,000 separate — are set by statute and never indexed. The capital gains calculator applies both layers.

2026 alternative minimum tax (AMT) amounts

The 28% AMT rate applies to AMT income above $244,500 after the exemption ($122,250 married filing separately). Two OBBBA changes matter: the phaseout thresholds dropped back to $500,000 and $1,000,000 (from $626,350 and $1,252,700 in 2025), and the exemption now shrinks by 50 cents per dollar over the threshold instead of 25 cents. Rev. Proc. 2025-32 notes the $1,000,000 joint threshold is not indexed for years before 2027.

Example: a single filer with $600,000 of AMT income loses 50% × ($600,000 − $500,000) = $50,000 of exemption, leaving $90,100 − $50,000 = $40,100. Under 2025 rules the same filer would have kept the full $88,100. Test incentive stock option exercises and large state-tax add-backs in the AMT calculator.

2026 earned income tax credit table

Investment income above $12,200 in 2026 disqualifies you from the EITC entirely — up from $11,950 in 2025. Interest, dividends, capital gains, and net rental income all count. Estimate your credit with the EITC calculator.

Child tax credit and other family credits for 2026

The child tax credit now requires a valid Social Security number for the child and at least one parent on a joint return, per Pub. 505. Model credits with the child tax credit calculator and the adoption tax credit calculator; the adoption credit guide covers timing rules for domestic and foreign adoptions.

Estate, gift, and generation-skipping amounts

The OBBBA set the basic exclusion at $15 million for 2026 and indexes it starting in 2027, so the scheduled drop to roughly half that amount never happened. A married couple can give $38,000 per recipient in 2026 by gift-splitting without touching their lifetime exemption. The gift tax calculator and estate tax calculator use these figures, and how the gift tax works explains Form 709.

Workplace benefit limits for 2026

The dependent care jump from $5,000 to $7,500 is an OBBBA change, not an inflation adjustment. The bicycle commuting exclusion was permanently eliminated. Run the payroll-tax savings in the FSA and commuter benefits calculator and the HSA calculator.

Retirement plan limits for 2026

Retirement limits come from a separate IRS release, Notice 2025-67, not Rev. Proc. 2025-32.

For 2027, Notice 2026-66 raises the 401(k) limit to $25,500 (catch-up $8,500, or $11,750 at ages 60–63) and keeps the IRA limit at $7,500. The 401(k) and IRA contribution limits guide has the full 2027 table, the $72,000 total-additions cap for 2026, the Roth catch-up rule for higher earners, and SIMPLE and SEP limits.

Self-employed savers can compare a solo 401(k) and SEP in the solo 401(k) calculator.

Foreign earned income exclusion and other individual items

For U.S. citizens abroad, the housing exclusion base is 16% of the FEIE ($21,264 for 2026) and the standard housing expense cap is 30% ($39,870), higher in IRS-listed high-cost cities. The FEIE calculator applies the daily proration if you qualify for only part of the year.

Business and self-employment thresholds

The wage base is set by the Social Security Administration, not the IRS. For 2027 it rises to $192,300 (91 FR 67380).

What the IRS did not adjust

Some amounts are frozen by statute, and it is easy to assume they moved:

• Lifetime Learning Credit phaseout: still $80,000–$90,000 single and $160,000–$180,000 joint, unchanged since 2021. See the Lifetime Learning Credit income limits.
• Personal exemption: $0, made permanent by the OBBBA.
• Net investment income tax and Additional Medicare Tax thresholds: $200,000 / $250,000, never indexed.
• Child tax credit phaseout: $200,000 / $400,000.
• SALT cap: set directly by the OBBBA at $40,400 for 2026 (up from $40,000 in 2025), not by the inflation formula. It shrinks for modified AGI above $505,000 but not below $10,000.
• Itemized deductions: the old Pease limit is gone, but a new rule trims the value of itemized deductions for filers in the 37% bracket. The itemized deduction cap guide shows the math.

How to use these numbers before year-end

1. Check your withholding. Payroll systems switched to 2026 tables in January, but a raise, bonus, or second job can push you into a higher bracket. Compare your year-to-date withholding with the bracket math above.
2. Use the 0% capital gains band. A married couple with $70,000 of taxable ordinary income can realize up to $28,900 of long-term gains at 0% ($98,900 − $70,000).
3. Front-load benefit elections. Open enrollment for 2027 happens this fall. Rev. Proc. 2026-35 sets the 2027 health FSA limit at $3,500 (carryover up to $700) and transit and parking at $350 a month each, so you can elect the new maximums now.
4. Gift before December 31. Annual exclusion gifts do not carry over. Unused 2026 exclusions are lost on January 1.
5. Watch AMT if you exercised ISOs. The faster 50% exemption phaseout catches more single filers between $500,000 and $680,200 of AMT income.