OBBBA Tax Calculator 2026 — Compare the New Tax Law vs Prior Law
The One Big Beautiful Bill Act (OBBBA) is the most significant change to the individual tax code since the TCJA. Use our free OBBBA tax calculator to instantly compare your 2026 federal income tax under OBBBA against what you would have paid if the TCJA had sunset as scheduled. All calculations run in your browser — no sign-up, no data stored.
Enter your 2026 tax situation. The calculator instantly compares your tax under the One Big Beautiful Bill Act (OBBBA) against what you would have paid if the TCJA had sunset as scheduled.
OBBBA Child Tax Credit: $2,200 per child (vs $1,000 pre-TCJA).
OBBBA SALT cap: $40,400 (vs $10,000 under old TCJA cap; unlimited pre-TCJA).
New OBBBA deduction for traditionally tipped occupations.
Time-and-a-half pay for hours beyond 40/week. New OBBBA deduction.
OBBBA adds a $2,000 senior deduction per spouse 65+.
From your last pay stub or W-2 Box 2. Used to compute refund or balance due.
Your OBBBA Tax Savings (2026)
$1,406
OBBBA lowers your federal income tax by $1,406 compared to letting the TCJA expire.
Refund difference: +$1,406
Under OBBBA (2026)
Under Prior Law (Pre-TCJA Sunset)
OBBBA Provisions Applied
This calculator provides estimates based on 2026 federal tax rules under OBBBA (P.L. 119-1) and the pre-TCJA law that would have applied if TCJA had sunset. State taxes, AMT, and special circumstances are not included. The tip and overtime deductions are temporary provisions under OBBBA. Consult a tax professional for advice specific to your situation.
What Is OBBBA?
The One Big Beautiful Bill Act (OBBBA, P.L. 119-1), signed in 2025, made the individual tax cuts from the Tax Cuts and Jobs Act (TCJA) of 2017 permanent. Without OBBBA, the TCJA provisions would have sunset on December 31, 2025, and 62% of taxpayers would have faced higher taxes in 2026 — the largest federal tax increase in a generation. OBBBA didn’t just extend TCJA, though; it also introduced several brand-new deductions that affect how much you owe.
The five OBBBA changes that matter most for your 2026 tax return are: (1) TCJA brackets made permanent, preventing reversion to higher rates; (2) the SALT deduction cap raised from $10,000 to $40,400; (3) the Child Tax Credit doubled from $1,000 to $2,200 per child; (4) new above-the-line deductions for qualifying tip income and overtime pay; and (5) a new $2,000 additional deduction for taxpayers aged 65 and older. The calculator above applies each of these provisions to your situation.
SALT Cap Increased to $40,400
The single most impactful OBBBA change for upper-middle-income filers in high-tax states is the increase in the state and local tax (SALT) deduction cap from $10,000 to $40,400. If you itemize deductions, you can now deduct up to $40,400 in combined state income tax, property tax, and sales tax — a $30,400 increase from the old TCJA cap that had been in place since 2018.
A California family with $200,000 income paying $15,000 in state income tax and $8,000 in property tax can now deduct the full $23,000 (vs only $10,000 under the old cap). At a 22% marginal rate, that’s approximately $2,860 in federal tax savings — a meaningful win for itemizers in California, New York, New Jersey, Connecticut, and Illinois. Single filers with MAGI above $500,000 and married filers above $1,000,000 face a phaseout that reduces the cap back to $10,000.
Child Tax Credit Doubled to $2,200
OBBBA raises the Child Tax Credit (CTC) to $2,200 per qualifying child under 17 for 2026, doubled from the $1,000 pre-TCJA level and indexed to inflation going forward. The refundable portion (Additional Child Tax Credit) increases to $1,700, meaning even families with little or no federal income tax liability can receive a partial refund. The credit begins phasing out at $200,000 MAGI for single filers and $400,000 for married filing jointly.
A family with three qualifying children saves up to $3,600 compared to pre-TCJA law ($1,200 increase per child × 3 children). Use the calculator above to see exactly how much your CTC will be under OBBBA. You can also pair this with our paycheck calculator to see how the CTC affects your take-home pay throughout the year.
New Tip & Overtime Deductions
OBBBA introduces two brand-new above-the-line deductions: a tip income deduction for qualifying tipped occupations (restaurant servers, bartenders, hospitality staff, hair stylists, and similar roles), and an overtime pay deduction for qualifying time-and-a-half overtime pay. Both are temporary provisions scheduled to sunset in future years, but they provide meaningful after-tax income increases for service industry and hourly workers during their effective period.
For a restaurant server earning $25,000 in tips on top of a $30,000 base wage, the tip deduction could reduce taxable income by up to $25,000 — potentially saving thousands in federal tax. Similarly, a manufacturing worker earning $15,000 in qualifying overtime pay could see a comparable deduction. Documentation requirements apply (Form 4137 or Form 4070 for tips; employer overtime reporting for the overtime deduction), and the IRS is expected to scrutinize these new deductions closely.
New $2,000 Senior Deduction
Taxpayers aged 65 and older can claim an additional $2,000 deduction on top of the standard deduction under OBBBA. Combined with the existing additional standard deduction for seniors (approximately $1,950 for single filers in 2026), a single senior taking the standard deduction can subtract roughly $20,050 from gross income before calculating federal tax. For married couples where both spouses are 65+, the combined deduction is even larger. This is particularly valuable for retirees with pension, Social Security, or IRA distribution income.
Who Benefits Most (and Who Doesn’t)
Biggest winners: Families with children (doubled CTC), upper-middle-income itemizers in high-tax states (raised SALT cap), tipped workers (new tip deduction), hourly employees with regular overtime (new overtime deduction), and seniors 65+ (new senior deduction). The middle and upper-middle income quintiles see the largest percentage gains — roughly 5-6% increases in after-tax income according to Tax Foundation analysis.
Limited benefit: Very high earners (SALT phaseout), non-itemizers in no-income-tax states like Texas and Florida (no SALT to deduct), and households without children (no CTC). These taxpayers still benefit from the permanent TCJA brackets but miss out on the targeted OBBBA deductions.
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Methodology & Data Sources
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OBBBA vs Prior Law: Key Tax Provisions Compared
The table below summarizes the most important differences between OBBBA (2026 tax law) and the prior law (pre-TCJA sunset). Use it to quickly understand how each provision affects your federal income tax.
| Tax Provision | OBBBA (2026) | Prior Law (Pre-TCJA) |
|---|---|---|
| Top federal tax bracket | 37% (TCJA made permanent) | 39.6% (TCJA sunset) |
| Standard deduction (Single) | $16,100 | $8,300 (pre-TCJA level) |
| SALT deduction cap | $40,400 | $10,000 (old TCJA cap) |
| Child Tax Credit | $2,200 per child | $1,000 per child |
| Tip income deduction | New above-the-line deduction | No deduction |
| Overtime pay deduction | New above-the-line deduction | No deduction |
| Senior deduction (65+) | $2,000 additional deduction | No additional deduction |
| AMT exemption (Single) | $88,700 (TCJA permanent) | $55,400 (pre-TCJA) |
| Estate tax exemption | $14.6 million | $7 million (pre-TCJA) |
| QBI deduction (Section 199A) | 20% (made permanent) | Expired (0%) |
Source: One Big Beautiful Bill Act (P.L. 119-1), signed July 4, 2025. Estimates based on IRS 2026 tax brackets and TCJA provisions.
OBBBA Tax Calculator FAQ
What is the OBBBA tax calculator?
The OBBBA tax calculator compares your 2026 federal income tax under the One Big Beautiful Bill Act (OBBBA, P.L. 119-1) against what you would have paid if the Tax Cuts and Jobs Act (TCJA) had sunset as scheduled on December 31, 2025. It applies every relevant OBBBA provision — permanent TCJA brackets, the $40,400 SALT cap, the doubled $2,200 Child Tax Credit, the new tip and overtime deductions, and the $2,000 senior deduction — and shows your tax savings (or cost) line by line.
How does OBBBA change my 2026 tax refund?
OBBBA generally increases refunds for most taxpayers by preventing the reversion to higher pre-TCJA brackets, doubling the Child Tax Credit to $2,200, raising the SALT cap from $10,000 to $40,400, and introducing new deductions for tips, overtime, and seniors. According to the Tax Foundation, OBBBA raises after-tax income by an average of 5.4% in 2026. Use the calculator above to see your specific refund impact, or try our free tax refund calculator for a complete picture including withholding.
Is the OBBBA tip income deduction permanent?
No. The tip income deduction for qualifying tipped occupations (restaurant servers, bartenders, hospitality staff, hair stylists, and other traditionally tipped workers) is a temporary provision under OBBBA and is scheduled to sunset in future years. The overtime pay deduction is similarly temporary. The TCJA bracket structure, the higher SALT cap, and the doubled Child Tax Credit are permanent under OBBBA.
Does the OBBBA SALT cap phaseout affect me?
The OBBBA SALT cap of $40,400 begins to phase out for single filers with MAGI above $500,000 and married filing jointly filers above $1,000,000. The phaseout reduces the cap linearly back down to $10,000 over a $200,000 range. If your MAGI is below those thresholds, you get the full $40,400 cap (subject to the actual amount of state and local taxes you paid). Most taxpayers — over 95% — fall below the phaseout and receive the full benefit.
How does OBBBA affect families with children?
OBBBA doubles the Child Tax Credit from $1,000 (pre-TCJA) to $2,200 per qualifying child under 17, with up to $1,700 refundable. The credit begins phasing out at $200,000 MAGI for single filers and $400,000 for married filing jointly. A family with three children can save up to $3,600 compared to pre-TCJA law. The credit is indexed to inflation going forward, so it will continue to rise in future tax years.
Who benefits most from OBBBA?
The biggest winners under OBBBA are families with children (thanks to the doubled Child Tax Credit), upper-middle-income itemizers in high-tax states (California, New York, New Jersey, Connecticut, Illinois — thanks to the SALT cap increase), tipped workers (new tip deduction), hourly employees with regular overtime (new overtime deduction), and seniors 65+ (new $2,000 senior deduction). Households without children in no-income-tax states who take the standard deduction benefit least, though they still gain from the permanent TCJA brackets.
This OBBBA tax calculator provides estimates for informational and educational purposes only. It does not constitute tax advice. The calculator uses 2026 federal tax figures from IRS Revenue Procedure 2025-25 and the JCT description of OBBBA (P.L. 119-1). State taxes, AMT, and special circumstances are not included. Tax law changes frequently — consult a qualified tax professional (CPA, EA, or tax attorney) for advice specific to your situation.