TCJA Sunset: What Every Taxpayer Must Know in 2026

The Tax Cuts and Jobs Act of 2017 reshaped the American tax landscape — lower rates, a doubled standard deduction, and a $10,000 SALT cap. Many of its provisions were set to expire after 2025. Here's what's changing, what was extended, and what you need to do now.

What Was the TCJA?

The Tax Cuts and Jobs Act, signed in December 2017, was the largest overhaul of the U.S. tax code in three decades. Key individual provisions included:

Lower individual income tax rates across all brackets
Nearly doubled standard deduction
$10,000 cap on State and Local Tax (SALT) deductions
Doubled child tax credit to $2,000
Eliminated personal exemptions
Reduced corporate tax rate to 21% (permanent)

The individual provisions were always set to "sunset" — expire — after December 31, 2025, unless Congress acted.

What Congress Did (and Didn't) Extend

Congress passed legislation extending most TCJA provisions, but with some important modifications. Here's a summary:

Lower individual tax rates: Extended — the 10%–37% rate structure remains in place
Higher standard deduction: Extended — continues with annual inflation adjustments
$10,000 SALT cap: Modified — the cap was adjusted; consult your tax advisor for the current limit in your state
Child Tax Credit: Extended with some modifications to refundability thresholds
QBI deduction (Section 199A): Extended — the 20% deduction for pass-through business income continues
Estate tax exemption: Modified — the exemption amount decreased from TCJA levels

⚠️ Important: Tax legislation is complex and evolving. The specifics above are subject to final Congressional action. Always confirm with a qualified tax professional before making decisions.

The QBI Deduction: A Big Win for Small Business Owners

One of the most valuable TCJA provisions for small business owners was the Section 199A Qualified Business Income (QBI) deduction — allowing eligible self-employed individuals and pass-through business owners to deduct up to 20% of qualified business income. With this extended, a business owner earning $100,000 in QBI could reduce taxable income by $20,000.

Estate Planning in 2026: Act Now

The TCJA doubled the federal estate tax exemption. Even with extensions, the exemption levels are being adjusted. If your estate is valued above the current threshold, proactive planning in 2026 — gifting strategies, trusts, and asset restructuring — can significantly reduce your heirs' tax burden.

What You Should Do Right Now

Schedule a comprehensive tax planning review for 2026
Reassess your withholding and quarterly estimates
If you own a business, review your entity structure in light of the QBI extension
For high-net-worth individuals, start estate planning conversations immediately
Review your itemized vs. standard deduction position under the new SALT rules

The Tax Law Just Changed. Your Strategy Should Too.

Our team is up to date on every 2026 legislative change. Let's review your situation and build a strategy that puts you ahead — not behind.