Brought to you by the EveryDollar app. Start budgeting for free today. All right, tax time is just around the corner. 2026 taxes, don't worry, George and I have you covered with everything that you need to know.
George, this feels like a talk nerdy to me segment. The big highlights are tax brackets have been adjusted for inflation. Ooh. Ooh, wow.
And tax rates stay the same. That's 10% to 37%. So those tax rates for the brackets stay the same. The income thresholds have increased.
Yeah, get in there, tell me more. If you're watching on YouTubersPodify, we have the visuals up so you can see the table because this is one of the most confusing things about taxes. People get it twisted. People say, well, Jade, I don't want to make a dollar and push me into the next bracket.
Yeah, I'm assuming the wrong thing. Only that new dollar is taxed at the new rate. So you got to understand that. So let me go over the numbers.
So 10% bracket is up to $12,400 if you're single, 24,800 if you're married filing jointly. Then from that number up to 50,400 if you're single, 12% bracket. And for married filing jointly, $100,800. And then we move to the 22% bracket, which is from that 50 grand up to 105,700 if you're single and up to 211,400 if you're married filing jointly.
If you're doing the math at home, it doubles. It goes married filing jointly, keeps it simple. And then 37%, which is the highest bracket, any money you make, over $640,600 if you're single, will be taxed at 37% and married filing jointly. Any dollar you make, over $768,700, will be taxed at 37%.
Have you fallen asleep yet? I wanted to, but I forced myself to stay awake in order to say the words, yes, paying taxes sucks, but making money is always going to feel nicer. Yes, so you need to think about what the marginal tax rate is versus effective. So effective meaning, yes, you got up into that 22% tax rate, but when you averaged it all out, it was really 15% is what you paid on your total income.
So there you go. That's the federal brackets with the adjusted thresholds. So what about standard deduction increases, George? Don't get me started.
Come on, I want to wind it up. Let's go. So most people will benefit from taking the standard deduction. And so this is probably you, if you're listening.
The standard deduction lowers your taxable income and is now higher again for 2026, which is good news. So standard deduction, if you're single, is $16,100. So the IRS basically says, we didn't see that money. It's a freebie.
The rest, we're going to touch. But that part, we won't. Married filing jointly, $32,200. That ain't bad.
And head of household, $24,150. So for all of you saving up every single receipt, thinking that maybe you can outdo it, you're probably not good. Tax season is coming up fast, which means a lot of you are paying more attention to your money and maybe realizing the holiday damage. So if you're trying to clean up the budget and start the year strong, cutting your phone bill is an easy win.
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So unless you're a business owner, you got a very complex schedule, see a situation, you're self-employed. Some people at 1099, sometimes it makes sense to itemize, and you can check with the CPA or Tax Pro on that. Now there's a lot surrounding the one big beautiful bill act. When I know people, I know one big beautiful bill, there's a lot of questions around that.
How's it going to affect us this tax term? What do you have to say about that? So for anyone that makes tips, you're happy about this. No tax on most tips, which is a first for any workers.
I have to say, I think that's great. They're hustling out there. Let them have it. And then you've got overtime pay deduction for hourly workers.
So that's nice as well if you do overtime. And then senior shout out to the AARP members out there. You get an deduction, a new $6,000 deduction, available whether you go standard or itemize for taxpayers age 65 plus subject to income limits. Okay, do you know what those are?
Dave Ramsey, sorry. Yeah, he hits the age, but not the income. That's okay. He'll be fine.
He will survive. All right, I love that. So just a couple of smart tax tips going forward. Make sure that you're gathering up your documents early guys.
Don't wait till the last minute. You're going to need your W2s, your 1099s, any receipts. Start gathering that stuff now. Put it in a folder because they're going to need it.
Also, you need to decide whether you're going to do this thing yourself or whether you're going to hire a tax pro. Again, if it's simple, just your basic W2, you probably can handle it yourself. But if it's a little bit more complex, you're probably going to need a pro. If needed, make sure to file your extension, okay?
File the extension, but you still got to pay April 15. Yes, it's illegal to not pay in time. It's not illegal to file the extension. So if you don't file in time, file the extension, but you got to pay what you owe.
And you can use tax planning to produce surprises next year. I always ask my tax guy, hey, what can I do better next year? That's right. What are you saying?
I want to always improve and pay the government a little bit less if I can. And so the bottom line for 2026, higher deductions and inflation adjusted brackets may lower your tax burden, but deadlines and planning still matter. So be proactive to keep more of your income and avoid stress. That's right.
And George, good tax planning isn't about the loopholes, although we might find you some of those. It's about being intentional. You work really hard. Don't give more than you need to the IRS.
Which is what I'm leaving to her, by the way. If you get a refund this year, just know you overpaid the government as a blessing to them. And they said, no, we can't take that legally. You can have it back.
That's right. That's money that you could be putting towards whatever baby step you're on. So take a closer look at that. But for any questions around how to file taxes, or if you need to work with one of our pros, go ahead and head to ramsysolutions.com slash taxes.
That's ramsysolutions.com slash taxes. All right, George. We did it. I feel good.
That was very, very nerdy. That might be the nerdiest we've ever gotten. No insults, no injuries. We all learned something.