A deduction lowers the income your rate applies to, so it is worth your marginal rate times the amount. These pieces cover the standard deduction, when itemizing wins, the SALT cap, and the new federal deductions for tips, overtime, car-loan interest and seniors.
· 8 min read
For tax year 2026, ten of the 41 states that tax wages let the federal tip deduction reduce state tax, and eight do the same for overtime. Georgia and Alabama wrote smaller deductions of their own, twelve states have said in writing that tips stay taxable, and for seventeen we found no published answer.
· 6 min read
The federal return excludes a 2026 health savings account contribution of up to $4,400 for self-only coverage. California and New Jersey do not: a $65,000 single filer who contributes the maximum is still taxed by either state on all $65,000, whether the money went through payroll or not, and California taxes the account's earnings every year as well.
· 11 min read
Thirty-seven states and the District of Columbia give a deduction or credit for 529 contributions in tax year 2026. For a single filer earning $65,000, a $5,000 deposit is worth nothing in North Dakota and $1,000 in Indiana, and nine states take another state's plan.
· 9 min read
For a single filer in tax year 2026, North Dakota's federal deduction and 0% bracket shield $65,675 of wages, Pennsylvania shields none, and Indiana and New Jersey stop at $1,000. Eight states and the District use the federal $16,100 deduction, and twelve states take part or all of their shield back as income rises.
· 8 min read
For tax year 2026 the $40,400 SALT cap loses 30 cents for every dollar of MAGI above $505,000 and lands on its $10,000 floor at $606,334. Inside that band an itemizer's next dollar of income is taxed as $1.30, a 45.5 percent federal rate in the 35 percent bracket.
· 6 min read
For tax year 2026, the tip and overtime deductions start from two new W-2 box 12 codes, TP and TT, plus a tipped-occupation code in new box 14b. A worker can report missing tips on Form 4137, but the overtime deduction reaches only overtime that appears on a W-2 or 1099.
· 7 min read
Before December 31, 2026, an extra $5,000 of 401(k) deferral cuts the $65,000 single filer's federal tax by $600 and the $185,000 filer's by $1,200; harvesting $18,000 of losses saves the second filer $2,970. Pennsylvania taxes the deferral anyway; Illinois does not.
· 7 min read
Itemizing pays for tax year 2026 once Schedule A clears $16,100 single or $32,200 joint. Under the $40,400 SALT cap, a single homeowner's state and local taxes clear that line by themselves in New Jersey and Illinois; in Texas and Florida the standard deduction usually still wins.
· 7 min read
The 2025 Schedule 1-A computes one modified AGI, runs the tip, overtime, car-loan-interest, and senior deductions through four separate phase-outs, and sends a single total to Form 1040 line 13b. The total stacks on the standard deduction or itemized deductions, and adjusted gross income never moves.
· 5 min read
Taxpayers 65 and older deduct an extra $6,000 each through 2028, stacked on the standard deduction and the age-65 addition: for 2026 the layers total $24,150 for a single filer and $47,500 for a couple who are both 65. Each $6,000 shrinks by six cents per dollar of modified AGI over $75,000 ($150,000 joint) and is gone at $175,000 ($250,000 joint).
· 6 min read
For tax years 2025 through 2028, up to $10,000 a year of interest on the loan behind a new, US-assembled, personal-use vehicle comes off taxable income on Schedule 1-A, stacked on the standard deduction. The assembly test is settled per VIN, and past $100,000 of MAGI the deduction shrinks by $200 for each $1,000.
· 7 min read
For tax years 2025 through 2028, workers in listed tipped occupations can deduct up to $25,000 of reported tips, and hourly workers up to $12,500 of FLSA overtime premium. Only the half-time slice of overtime counts, the deductions come off after AGI, and a married worker must file jointly to claim either.
· 6 min read
For tax year 2026 the SALT deduction cap is $40,400. It shrinks by 30 cents per dollar of modified AGI above $505,000, reaching its $10,000 floor at $606,334, and which states' filers see any of it depends on whose tax bills cleared the old cap.
· 7 min read
The OBBBA added four temporary federal deductions, all claimed on new Schedule 1-A with or without itemizing: up to $25,000 of reported tips, $12,500 of overtime premium, $10,000 of car-loan interest, and $6,000 per filer 65 or older. None of them reduces AGI, and all four expire after 2028. The same law set the 2026 SALT cap at $40,400, the child tax credit at $2,200, and the estate exclusion at $15 million.