Summary
Many Americans can expect larger tax refunds in 2026 due to President Donald Trump’s One Big Beautiful Bill Act (OBBBA). The law modifies tax withholding tables and allows for increased deductions, especially benefiting higher-income households.
Key Facts
- President Donald Trump’s One Big Beautiful Bill Act (OBBBA) aims to increase tax refunds in 2026.
- The changes to the tax withholding tables take effect in 2026, although some aspects are retroactive to 2025.
- The Congressional Budget Office predicts a $24 billion tax cut for the fiscal year 2025 under the new act.
- The Oxford Economics report estimates the refund increase could be as much as $50 billion in 2026.
- High-income individuals benefit the most due to higher limits on state and local tax (SALT) deductions.
- Tax savings vary by income, with high earners saving significantly more compared to lower-income earners.
- Retirees may see higher tax refunds due to an enhanced senior deduction ranging from $6,000 to $12,000.
- The act revives the 100 percent bonus depreciation for business owners, allowing full deduction of eligible purchases.
