Heads Up—The Tax Sun is Setting!

The 2017 Tax Cuts and Jobs Act (TCJA) brought temporary tax relief to millions of Americans. But from the start, these cuts were never meant to last forever. As things stand, they’re scheduled to expire after the 2025 tax season—raising an important question: What happens when these tax cuts sunset in 2026?

The TCJA didn’t just lower tax rates—it also widened the income thresholds for five of the seven federal tax brackets. This gave many Americans breathing room in terms of how much of their income was taxed at higher rates. But once the cuts expire, those wider brackets will narrow again, pushing more income into higher tax rates. The top marginal rate will jump back to 39.6%.

The TCJA also increased the standard deduction, expanded the child tax credit, and eliminated the personal exemption by setting it to $0. For business owners, the law introduced a valuable 20% deduction on qualified business income—a benefit that’s also set to disappear in 2026.

One of the most significant changes will be in estate taxes. In 2025, the federal estate tax exemption is $13.61 million per person, with a 40% tax on anything above that. But beginning in 2026, the exemption will be cut nearly in half, reverting to around $7 million per person—exposing far more estates to taxation.

The good news?
There are still effective strategies to reduce taxable income and manage your estate efficiently—without sacrificing your lifestyle. With the right planning, you can take advantage of the current tax landscape before these changes take effect.

***Doan Financial Group and/or representatives of Doan Financial Group are not tax professionals or advisors. Please consult with a tax professional.