The IRS recently announced the annual inflation adjustments for the 2025 tax year. Changes were made to more than 60 tax provisions which will impact taxpayers when they file in 2026. This includes the standard deduction, Earned Income Tax Credit (EITC), and alternative minimum tax exemption amount, among other items. Here’s a look at several of the upcoming changes.
Standard Deduction
The 2025 tax year will be the final year that the standard deduction increases under the 2017 Tax Cuts and Jobs Act (TCJA).
- Single and Married Filing Separately, $15,000. This is an increase of $400 over the 2024 standard deduction.
- Married Filing Jointly, $30,000. Up $800 from the 2024 standard deduction amount.
- Head of Household, $22,500. That’s an increase of $600 from the previous tax year.
If the TCJA is not renewed, we’ll likely see much lower standard deduction amounts for 2026.
2025 Tax Brackets
Although there are no changes to the marginal tax rates, the income limits for each have increased. For 2025, 37% remains the top tax rate.
| Marginal Tax Rate | Single/Individual Filers | Married Filing Jointly |
| 10% | $11,925 or less | $23,850 or less |
| 12% | Income over $11,925 | Income over $23,850 |
| 22% | Income over $48,475 | Income over $96,950 |
| 24% | Income over $103,350 | Income over $206,700 |
| 32% | Income over $197,300 | Income over $394,600 |
| 35% | Income over $250,525 | Income over $501,050 |
| 37% | Income over $626,350 | Income over $751,600 |
Alternative Minimum Tax Exemption Amount
The 2025 alternative minimum tax exemption amount for unmarried taxpayers increases to $88,100 ($68,650 for married filing separately) and begins to phase out at $626,350. For married couples filing together, it’s $137,000 and phases out starting at $1,252,700.
2025 Earned Income Tax Credit (EITC)
Qualifying taxpayers with three or more children will see their maximum EITC increase to $8,046. Those with two children may qualify for up to $7,152. Eligible taxpayers with one child may qualify for up to $4,328. Single and married taxpayers who earn less than $8,490 and have no children may be eligible for $649 under the EITC.
Other Notable 2025 Tax Changes
The following are other notable tax adjustments for 2025.
- Qualified Transportation Fringe Benefit. The monthly limitation increases to $325 for 2025.
- Health Flexible Spending Cafeteria Plans. The dollar limitation for employee salary reductions for contributions to health flexible spending arrangements rises to $3,300
- Adoption Credit. The maximum adoption credit allowed for the 2025 tax year rises to $17,280, up $470 from 2024.
- Annual Gift Exclusion. This increases to $19,000 for 2025, up from the $18,000 allowed in 2024.
- Estate Tax Credits. Estates of decedents who die during 2025 have a basic exclusion amount of $13,990,000, an increase of $380,000 over 2024.
- Foreign Earned Income Exclusion. For tax year 2025, the foreign earned income exclusion increases to $130,000, a $3,500 increase from 2024.
Unchanged For 2025
For 2025, personal exemptions will remain at zero (eliminated under TCJA). There continues to be no limitation on itemized deductions, as well. The Lifetime Learning Credit was not adjusted for inflation. It continues to phase out at $80,000 ($160,000 for joint filers).
As we get closer to tax season, more changes are likely. Check back soon for any new updates!