Planning ahead for tax season can feel overwhelming — but a little awareness now can go a long way toward smarter financial and real estate decisions later.
As we head toward Tax Season 2026, the IRS has announced several important updates designed to account for inflation, prevent “bracket creep,” and extend key tax cuts. Whether you’re a homeowner, buyer, seller, investor, or planning your next move in the South Shore or Greater Boston, here’s what you need to know — and how it could impact your housing goals.
Why the IRS Adjusts Tax Brackets Each Year
Every year, the IRS updates income limits to keep pace with inflation. This prevents “bracket creep,” which happens when inflation alone pushes taxpayers into higher tax brackets — even if their real buying power hasn’t increased.
The good news:
For 2026, many Americans will be able to earn more income before moving into a higher tax bracket, which could mean lower overall tax bills or bigger refunds.
2026 Federal Tax Brackets at a Glance
Married Filing Jointly
| Tax Rate | 2025 Income | 2026 Income |
|---|---|---|
| 10% | $0 – $23,850 | $0 – $24,800 |
| 12% | $23,851 – $96,950 | $24,801 – $100,800 |
| 22% | $96,951 – $206,700 | $100,801 – $211,100 |
| 24% | $206,701 – $394,600 | $211,401 – $403,550 |
| 32% | $394,601 – $501,050 | $403,551 – $512,450 |
| 35% | $501,051 – $751,600 | $512,451 – $768,700 |
| 37% | $751,601+ | $768,701+ |
Single Filers
| Tax Rate | 2025 Income | 2026 Income |
|---|---|---|
| 10% | $0 – $11,925 | $0 – $12,400 |
| 12% | $11,926 – $48,475 | $12,401 – $50,400 |
| 22% | $48,476 – $103,350 | $50,401 – $105,700 |
| 24% | $103,351 – $197,300 | $105,701 – $201,775 |
| 32% | $197,301 – $250,525 | $201,776 – $256,225 |
| 35% | $250,526 – $626,350 | $256,226 – $640,600 |
| 37% | $626,351+ | $640,601+ |
Updated 2026 Standard Deductions
The IRS also increased standard deductions, which is especially helpful for homeowners who don’t itemize.
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Married filing jointly: $32,200
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Head of household: $24,150
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Single filers: $16,100
Bonus for Seniors (65+)
Thanks to the One Big Beautiful Bill Act, taxpayers aged 65 and older may qualify for an additional deduction of up to $6,000, available through 2028 (subject to income limits).
Understanding Your Tax Bracket (and a Common Myth)
A common misconception is that once you reach a higher tax bracket, all your income is taxed at that rate. That’s not how it works.
The U.S. tax system is progressive, meaning income is taxed in layers.
Example:
A married couple earning $150,000 in 2026:
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Subtract standard deduction: $150,000 – $32,200 = $117,800 taxable income
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Their top marginal rate is 22%
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But their effective tax rate is only about 13%
This distinction is important when planning:
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Selling a home
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Taking on rental income
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Receiving bonuses or commissions
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Retiring or downsizing
Key Tax Changes That May Impact Homeowners & Investors
SALT Deduction Expanded
The cap on State and Local Tax (SALT) deductions increased from $10,000 to $40,000 — a change that could significantly benefit higher-income households in Massachusetts who itemize deductions.
This is especially relevant for:
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Homeowners with higher property taxes
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Dual-income households
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Investors with multiple properties
Bigger Refunds May Be Coming
Because IRS withholding tables haven’t yet fully caught up with new tax laws, many taxpayers may have overpaid during the year — potentially leading to larger refunds in early 2026.
The IRS estimates:
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Total refunds could increase by $50 billion
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The average refund in 2025 was $2,939
For homeowners, that refund could help with:
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Down payments
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Renovations
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Paying down mortgages
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Investing in another property
Earned Income Tax Credit Increase
Families with three or more children could receive up to $8,231 through the Earned Income Tax Credit in 2026 — offering additional relief for qualifying households.
Estate Tax Changes
The federal estate tax exclusion increases to $15 million in 2026, which may be meaningful for families planning long-term wealth transfer or holding valuable real estate assets.
Health Flexible Spending Accounts
Workers can contribute up to $3,400 to Health FSAs in 2026 — another opportunity for tax-advantaged planning.
What This Means for South Shore & Greater Boston Homeowners
Tax changes don’t happen in a vacuum — they directly impact real estate timing and strategy, especially in a market like ours.
These updates may influence decisions such as:
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When to sell or buy
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Whether to invest in rental property
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How much home you feel comfortable purchasing
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Whether downsizing or upsizing makes financial sense
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How to plan for retirement or generational wealth
At The Jenkins Group, we work closely with our clients to help them see the big picture — not just today’s market, but how taxes, timing, and long-term goals all connect.
Final Thoughts
While we always recommend speaking with a qualified tax professional for personalized advice, staying informed now helps you ask better questions later — and make more confident decisions when it comes to your home and financial future.
If you’re thinking about:
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Buying or selling in 2026
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Using a tax refund strategically
Understanding how these changes may affect your real estate plans
We’re always here to help.
If you have questions about how these tax changes could impact your home, future plans, or next real estate move, let’s talk. And if you need expert guidance beyond real estate, we’re happy to connect you with trusted local tax professionals, financial advisors, and other experts we know and trust here in the South Shore & Greater Boston area.
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Whether you’re planning ahead, weighing a move, or simply want to understand your options, The Jenkins Group is here to be a resource — not just for today, but for the long run.
