For tax year 2026, US individuals can owe federal income tax (rates of 10% to 37%), FICA payroll tax (6.2% Social Security up to $184,500 of wages, plus 1.45% Medicare), capital gains tax (0%, 15% or 20% on most long-term gains), the 3.8% Net Investment Income Tax and 0.9% Additional Medicare Tax above income thresholds, and gift and estate tax only on transfers above a $19,000 per-person annual exclusion and a $15 million lifetime exclusion. Most people owe only the first two.
Federal tax figures are based on available IRS and Social Security Administration guidance for tax year 2026. Tax rules, thresholds, forms and state requirements may change. Confirm current official guidance before filing or making tax-planning decisions. This article is general information, not tax advice.
Tax Year 2026 vs the Return You File in 2026
This trips up a lot of readers, so I will clear it up first.
- Tax year 2026 covers income you earn and transactions you make between January 1 and December 31, 2026. You generally report it in early 2027.
- A return filed in 2026 usually reports tax year 2025.
If you filed an extension for tax year 2025, the extended due date is generally October 15, 2026. An extension gives more time to file, not more time to pay. Everything below applies to tax year 2026 unless I say otherwise.
The 2026 US Individual Tax Numbers at a Glance
| Tax | Who pays | 2026 figure | Main form |
|---|---|---|---|
| Federal income tax | Nearly all earners | 10%, 12%, 22%, 24%, 32%, 35%, 37% | Form 1040 |
| Social Security tax | Employees and employers (self-employed pay both) | 6.2% each on wages up to $184,500 | Withheld / Schedule SE |
| Medicare tax | Employees and employers | 1.45% each, no wage cap | Withheld / Schedule SE |
| Additional Medicare Tax | Higher earners | 0.9% above $200,000 (single), $250,000 (joint) | Form 8959 |
| Capital gains tax | People who sell assets at a gain | 0%, 15%, 20% on long-term gains | Form 8949, Schedule D |
| Net Investment Income Tax | Higher-income investors | 3.8% above $200,000 / $250,000 MAGI | Form 8960 |
| Gift tax | Donors giving above the exclusion | $19,000 per recipient per year | Form 709 |
| Estate tax | Very large estates | $15,000,000 basic exclusion | Form 706 |
Sources: IRS Revenue Procedure 2025-32, SSA, IRS NIIT page, IRS gift tax FAQs.
Federal Income Tax in 2026
How the brackets work
Federal income tax is progressive. Each rate applies only to the slice of taxable income inside its bracket, not to your entire income. That is the single most common misunderstanding about tax brackets. Moving into a higher bracket never makes your whole income taxed at the higher rate.
If you want the background, read our guide on bracket creep and inflation.
2026 tax brackets
The IRS published these in Revenue Procedure 2025-32. The table shows the income where each rate begins.
| Rate | Single | Married filing jointly | Head of household |
|---|---|---|---|
| 10% | $0 | $0 | $0 |
| 12% | over $12,400 | over $24,800 | over $17,700 |
| 22% | over $50,400 | over $100,800 | over $67,450 |
| 24% | over $105,700 | over $211,400 | over $105,700 |
| 32% | over $201,775 | over $403,550 | over $201,750 |
| 35% | over $256,225 | over $512,450 | over $256,200 |
Married filing separately uses the same thresholds as single up to the 35% bracket, and the 37% rate begins above $384,350.
2026 standard deduction
- Single or married filing separately: $16,100
- Married filing jointly: $32,200
- Head of household: $24,150
Not sure whether to take the standard deduction or itemize? Our guide on standard vs itemized deductions in 2026 walks through it.
Worked example: a single filer
Say you are single, earn a $96,100 salary, and take the standard deduction.
- Taxable income: $96,100 − $16,100 = $80,000
- Tax on the first $50,400: $5,800 (from the IRS table)
- Tax on the next $29,600 at 22%: $6,512
- Total federal income tax: $12,312
That is about 15.4% of taxable income, which is your effective rate. Your marginal rate is 22%. This ignores credits and other deductions, so your real bill can differ.
To run your own numbers, try our income tax calculator.
Alternative Minimum Tax (briefly)
The IRS also lists 2026 AMT exemptions: $90,100 for unmarried filers (phase-out starts at $500,000) and $140,200 for joint filers (phase-out starts at $1,000,000). Most people never owe AMT, but high earners with large deductions sometimes do.
FICA Taxes in 2026: Social Security and Medicare
What FICA is
FICA stands for the Federal Insurance Contributions Act. It funds Social Security (the OASDI program) and Medicare Hospital Insurance. You see it on your paycheck as "FICA," "Social Security" and "Medicare."
2026 FICA rates and the wage base
Per the Social Security Administration:
- Social Security: 6.2% for the employee and 6.2% for the employer, on wages up to $184,500.
- Maximum Social Security tax per worker: $11,439.00, with the employer paying the same amount.
- Medicare: 1.45% for the employee and 1.45% for the employer, with no wage cap.
- Self-employed: 12.4% Social Security and 2.9% Medicare.
Worked example: a $60,000 employee
| Item | Amount |
|---|---|
| Social Security (6.2%) | $3,720 |
| Medicare (1.45%) | $870 |
| Employee FICA total (7.65%) | $4,590 |
Your employer pays another $4,590. Most people never notice because it is not deducted from their pay.
Additional Medicare Tax (0.9%)
The IRS Additional Medicare Tax guidance says a 0.9% tax applies to wages, railroad retirement compensation and self-employment income above:
- $200,000 for single, head of household or qualifying widow(er)
- $250,000 for married filing jointly
- $125,000 for married filing separately
Two details matter here. Employers must start withholding it once they pay an employee more than $200,000 in a calendar year, regardless of filing status. And there is no employer match for this tax. You report it on Form 8959.
Worked example: a $250,000 single filer
| Item | Amount |
|---|---|
| Social Security (capped) | $11,439 |
| Medicare (1.45% × $250,000) | $3,625 |
| Additional Medicare (0.9% × $50,000) | $450 |
| Employee total | $15,514 |
The employer pays $11,439 + $3,625 = $15,064.
FICA for the self-employed
Self-employed people pay both halves through self-employment tax. As a simple example, with $100,000 of net profit:
- Net earnings subject to the tax: 92.35% × $100,000 = $92,350 (the standard Schedule SE adjustment)
- Social Security at 12.4%: $11,451.40
- Medicare at 2.9%: $2,678.15
- Total: $14,129.55
You may then deduct half of that amount when computing income tax. Our self-employment tax vs income tax guide, the self-employment tax guide and the US self-employment tax calculator go deeper. If you are deciding between W-2 and contractor work, see W-2 vs 1099 tax calculation.
Why your paycheck is smaller than your salary
FICA is only one deduction between your gross pay and your net pay. Read our explainer on gross pay vs net pay.
Capital Gains Tax in 2026
Short-term vs long-term
A capital gain is the profit when you sell an asset for more than your adjusted basis (generally what you paid, plus adjustments). The IRS explains in Topic 409:
- Assets held more than one year produce long-term gains.
- Assets held one year or less produce short-term gains, taxed as ordinary income.
That one-year line can change your tax bill sharply. Selling on day 366 instead of day 360 can save real money.
2026 long-term capital gains rates
These thresholds apply to taxable income, not to the size of the gain. They are in Section 4.03 of Revenue Procedure 2025-32.
| Rate | Single | Married filing jointly | Head of household | Married filing separately |
|---|---|---|---|---|
| 0% | up to $49,450 | up to $98,900 | up to $66,200 | up to $49,450 |
| 15% | up to $545,500 | up to $613,700 | up to $579,600 | up to $306,850 |
| 20% | above those amounts | above those amounts | above those amounts | above those amounts |
Do not confuse these with the ordinary-income bracket thresholds in the earlier table. They are different numbers.
Higher rates for special assets
Per IRS Topic 409, some gains are taxed above 20%:
- Collectibles such as coins or art: up to 28%
- Qualified small business stock (section 1202): up to 28%
- Unrecaptured section 1250 gain on real property: up to 25%
Worked example: how gains stack on top of income
You are single. Your taxable ordinary income is $40,000, and you sell shares at a $20,000 long-term gain.
- The 0% bracket runs to $49,450. So $9,450 of the gain is taxed at 0%.
- The remaining $10,550 is taxed at 15%, which is $1,582.50.
Now suppose the same $20,000 gain were short-term:
- $10,400 fills the rest of the 12% bracket: $1,248
- $9,600 is taxed at 22%: $2,112
- Total: $3,360
Holding the asset more than a year saves $1,777.50 in this example.
Capital losses
If losses exceed gains, you can deduct up to $3,000 per year ($1,500 if married filing separately) against other income. Any remaining loss carries forward. Investors sometimes realize losses on purpose to offset gains, which is called tax-loss harvesting.
How to report gains
Most sales are listed on Form 8949 and summarized on Schedule D. Your broker usually sends a Form 1099-B to help.
Inherited assets
When you sell inherited property, the rules differ. Generally, the basis is reset to the asset's fair market value at the date of death (the "stepped-up basis"), and the holding period is treated as long-term. Check IRS Publication 551 for the exact rules, because exceptions exist.
Net Investment Income Tax (NIIT): The 3.8% Surtax
What it is
The IRS describes the NIIT as a 3.8% tax on the lesser of:
- your net investment income, or
- the amount by which your modified adjusted gross income (MAGI) exceeds the threshold.
Thresholds
- Single or head of household: $200,000
- Married filing jointly: $250,000
- Married filing separately: $125,000
- Qualifying widow(er) with a child: $250,000
What counts
Interest, dividends, capital gains, rental and royalty income and non-qualified annuities generally count. Wages, unemployment compensation, Social Security benefits, alimony and most self-employment income generally do not. Excluded gain on a personal residence is also excluded.
Worked example
You are single with MAGI of $230,000, including $50,000 of net investment income.
- Excess over threshold: $230,000 − $200,000 = $30,000
- Lesser of $50,000 and $30,000 = $30,000
- NIIT: 3.8% × $30,000 = $1,140
You report this on Form 8960.
NIIT vs Additional Medicare Tax
| NIIT | Additional Medicare Tax | |
|---|---|---|
| Rate | 3.8% | 0.9% |
| Applies to | Investment income | Wages and self-employment income |
| Form | 8960 | 8959 |
The IRS notes you can owe both, because they apply to different kinds of income.
Gift Tax in 2026
The basics
Gift tax applies to transfers of property for less than full value. Three facts matter most:
- Annual exclusion: $19,000 per recipient in 2026. A married couple giving jointly can give $38,000 per recipient.
- Who pays: the donor, generally. The recipient does not owe income tax on a gift.
- Lifetime basic exclusion: $15,000,000 for gifts made in 2026, according to the IRS gift tax FAQs, which cite Public Law 119-21.
The IRS also lists a higher annual exclusion of $194,000 for gifts to a spouse who is not a US citizen. Gifts to a US-citizen spouse generally qualify for the marital deduction.
Worked example
You give your daughter $50,000 in 2026.
- Annual exclusion: $19,000
- Taxable gift: $31,000
- You file Form 709, and the $31,000 reduces your lifetime exclusion.
- No gift tax is due unless your lifetime gifts exceed $15 million.
Many people are surprised that a "taxable gift" does not mean cash owed. It usually means a filing requirement and a slightly smaller lifetime exclusion.
Estate Tax in 2026
The basics
The IRS describes the estate tax as a tax on your right to transfer property at death. The basic exclusion for people dying in 2026 is $15,000,000. The same figure is the 2026 generation-skipping transfer exemption, and the IRS says the amounts will be adjusted for inflation starting in 2027.
Most estates are well below that level and owe no federal estate tax.
Who files Form 706
An estate must file Form 706 when the gross estate plus adjusted taxable gifts and the specific gift tax exemption exceeds the filing threshold. Deductions include debts, administration expenses, property passing to a surviving spouse and qualified charities.
Portability for married couples
A surviving spouse can generally elect to use the deceased spouse's unused exclusion. The election is made on a timely filed estate tax return. Even if no tax is due, filing can be valuable.
Estate tax vs inheritance tax
| Estate tax | Inheritance tax | |
|---|---|---|
| Who owes it | The estate | The person who receives property |
| Federal level | Yes | No federal inheritance tax |
| State level | Some states | A few states |
Receiving an inheritance is generally not federal taxable income. Some states, however, charge their own estate or inheritance taxes, often with much lower thresholds than the federal one. Check your state's department of revenue.
Illustration
Suppose a single person dies in 2026 with a $20 million taxable estate and no other adjustments. The estate exceeds the $15 million exclusion by $5 million. The top federal estate rate is generally 40%, so the tax on that excess would be roughly $2 million. Real calculations are more complicated, so treat this only as a rough illustration.
Federal vs State Taxes
Everything above is federal. States can add their own income, capital gains, estate and inheritance taxes. A few examples worth knowing about:
- Some states have no income tax. See states with no income tax in 2026 and our Texas income tax guide.
- Others tax income heavily. See California income tax rates for 2026 and the New York state income tax calculator.
- For the full picture, read federal vs state income tax in the USA, state income tax 2026 and try the US state income tax calculator.
State estate and inheritance rules differ widely, and they are separate from the federal rules. Never assume a federal threshold applies at the state level.
Which Tax Applies to You? A Quick Guide
| Your situation | Taxes likely to matter |
|---|---|
| Salaried employee, no investments | Federal income tax, FICA, state income tax |
| Freelancer or gig worker | Federal income tax, self-employment tax, estimated payments |
| Investor who sells stocks | Capital gains tax, possibly NIIT |
| High earner ($200,000+) | Additional Medicare Tax, possibly NIIT |
| Parent helping a child buy a home | Gift tax filing rules |
| Heir selling inherited stock | Stepped-up basis rules |
| Very large estate | Estate tax and Form 706 |
If you work for yourself, our freelance tax checklist and side hustle taxes guide help with estimated payments.
Which IRS Forms Do You Need?
- Form 1040: the main individual return
- Form 8949 and Schedule D: sales of stocks and other capital assets
- Form 8960: Net Investment Income Tax
- Form 8959: Additional Medicare Tax
- Form 709: gift tax return
- Form 706: estate tax return
Keep your tax documents in one place. Our guide on combining tax documents into one PDF can help, and a tax terms glossary explains the jargon. To reduce audit risk, read IRS audit triggers.
Practical Tax-Planning Moves for 2026
These are general ideas, not advice for your situation.
- Watch the one-year line. Holding a winning investment past a year can cut the rate on the gain.
- Know your income stack. Capital gains sit on top of your ordinary income, as the example above shows.
- Check withholding mid-year. If your income changed, adjust your W-4 or make estimated payments.
- Use the annual gift exclusion. Spreading gifts across years and recipients can keep Form 709 filings minimal.
- Keep basis records. Without records, you may pay tax on more profit than you made.
- Track the thresholds. NIIT and Additional Medicare Tax use fixed-dollar thresholds that are not adjusted with the brackets.
- Talk to a professional for big events. Selling a business, receiving a large inheritance or moving states all deserve a CPA's review.
Common Mistakes
- Treating bracket thresholds and capital gains thresholds as the same numbers
- Assuming your whole income is taxed at your top rate
- Forgetting that self-employed people pay both halves of FICA
- Thinking a gift above $19,000 means automatic gift tax
- Assuming an inheritance is taxable income
- Ignoring state taxes
Frequently Asked Questions
What are the federal income tax rates for 2026?
10%, 12%, 22%, 24%, 32%, 35% and 37%, according to IRS Revenue Procedure 2025-32. Which rate applies depends on your taxable income and filing status.
What is the standard deduction for 2026?
$16,100 for single filers, $32,200 for married couples filing jointly, and $24,150 for heads of household.
What does FICA stand for?
Federal Insurance Contributions Act. It covers Social Security and Medicare payroll taxes.
How much Social Security tax do employees pay in 2026?
6.2% on wages up to $184,500, so the maximum is $11,439. Employers pay a matching 6.2%.
Is there a limit on wages subject to Social Security tax?
Yes, $184,500 for 2026. Medicare tax has no limit.
Who has to pay the Additional Medicare Tax?
People with wages or self-employment income above $200,000 (single), $250,000 (joint) or $125,000 (married filing separately). It is 0.9%, and there is no employer match.
What are the 2026 long-term capital gains rates?
0%, 15% or 20%, depending on taxable income and filing status. For single filers, 0% applies up to $49,450 and 20% above $545,500.
Are short-term capital gains taxed as ordinary income?
Yes. Gains on assets held one year or less are taxed at your ordinary rates.
How much can I give someone without gift tax in 2026?
$19,000 per recipient. Married couples giving together can give $38,000 per recipient. Gifts above that generally require a Form 709 but not necessarily any tax.
What is the federal estate tax exemption in 2026?
$15,000,000 per person.
Does an inheritance count as taxable income?
Generally not at the federal level. But some states have inheritance taxes, and selling inherited assets can create capital gains.
Can I owe both capital gains tax and NIIT?
Yes. NIIT is an extra 3.8% on certain investment income, including capital gains, above the MAGI thresholds.
Where can I verify official US tax figures for 2026?
Use IRS Revenue Procedure 2025-32, the SSA contribution and benefit base page and the IRS pages cited above. Also compare how tax calendars differ in our tax filing deadlines by country guide.
Your Next Steps
- Write down your filing status and estimate your taxable income for 2026.
- Check whether any threshold (Additional Medicare Tax, NIIT, capital gains) applies to you.
- If you plan to sell investments or make large gifts this year, run the numbers before December 31.
- Keep records for every sale and gift.
- Confirm figures with the IRS, SSA and your state revenue department before you file.
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