The tax landscape in 2026 has shifted significantly. With the One Big Beautiful Bill Act (OBBBA) now in full effect, new deductions, expanded credits, and updated contribution limits are creating real opportunities for taxpayers who plan ahead. Whether you are an individual filer, a business owner, or a high-income earner, the right tax planning strategies 2026 can make a meaningful difference in what you owe — or what you keep.
At ABVCA, we work year-round to help our clients minimize their tax burden legally and strategically. Here are 10 actionable tax saving tips for 2026 that you can start using today.
1. Take Full Advantage of the Higher Standard Deduction
One of the most immediate wins for 2026 is the increased standard deduction. For married couples filing jointly, the standard deduction has risen to $32,200 — up $700 from last year. Single filers now get $16,100.
This means more of your income is automatically shielded from tax before you even begin itemizing. If your itemized deductions are close to the standard deduction amount, it may be worth bunching them into a single year to maximize your benefit.
CPA Tip: Run a comparison of your itemized vs. standard deduction every year. What worked last year may not be optimal in 2026.
2. Maximize Your 401(k) and Retirement Contributions
Retirement accounts remain one of the most powerful tax planning strategies available in 2026. The contribution limits have increased:
- 401(k): Up to $24,500 (or $32,500 if you are 50 or older)
- Ages 60–63: Special catch-up contributions of up to $11,250 are available if your plan allows
Every dollar you contribute to a traditional 401(k) reduces your taxable income dollar-for-dollar. If you have not already maxed out your contributions for the year, now is the time to adjust your payroll deductions.
CPA Tip: If you are 50 or older with FICA-taxable earnings above $150,000, note that catch-up contributions to a 401(k) must now go into a Roth 401(k). Plan accordingly to avoid surprises at filing time.
3. Claim the New Senior Deduction (Ages 65+)
This is one of the biggest new benefits introduced in 2026. If you are 65 or older, you may qualify for an additional senior deduction of $6,000 ($12,000 for joint filers). Crucially, you do not need to itemize to claim it.
However, this deduction begins to phase out for single filers with a modified adjusted gross income (MAGI) above $75,000, and for married joint filers above $150,000.
CPA Tip: This is separate from the existing elderly deduction of $2,000 for single filers and $3,200 for joint filers. You may qualify for both — do not leave this money on the table.
4. Use a Health Savings Account (HSA) for Triple Tax Benefits
An HSA is one of the few accounts that offers a triple tax advantage: contributions are tax-deductible, growth is tax-free, and qualified withdrawals are tax-free. For 2026, if you are enrolled in a high-deductible health plan (HDHP), contributing the maximum allowed to your HSA is a straightforward win.
HSAs also have no “use it or lose it” rule — unused funds roll over every year and can even be invested for long-term growth.
CPA Tip: After age 65, HSA funds can be withdrawn for any purpose without penalty (though non-medical withdrawals are taxed as ordinary income). Think of it as a stealth retirement account.
5. Harvest Tax Losses to Offset Capital Gains
If you have investments that are currently down in value, consider selling them before year-end to realize those losses. These losses can be used to offset capital gains, and up to $3,000 in excess losses can offset ordinary income per year. Any remaining losses carry forward to future years.
With long-term capital gains rates holding steady at 0%, 15%, and 20% in 2026, and inflation-indexed brackets, there may also be an opportunity to realize gains at a lower rate this year if your income is temporarily lower.
CPA Tip: Be mindful of the wash-sale rule — if you repurchase the same or substantially identical security within 30 days before or after the sale, the loss is disallowed.
6. Deduct Overtime and Tipped Wages (New for 2026)
This is a significant new benefit for 2026. Individuals may now claim a deduction of up to $25,000 for overtime pay and tipped wages — a major change that can substantially reduce taxable income for eligible workers.
Business owners, take note: this may create new reporting considerations, as the rules around tracking and documenting these wages for deduction purposes are still being refined by the IRS.
CPA Tip: Document all overtime and tipped wage income carefully throughout the year. Consulting with a CPA now — rather than at tax time — ensures you capture this deduction correctly.
7. Give More Strategically with Charitable Deductions
Charitable giving rules have changed in 2026. Even if you take the standard deduction, single filers can now claim a $1,000 cash charitable deduction ($2,000 for married filing jointly) without itemizing.
If you do itemize, consider “bunching” multiple years of donations into 2026 to push your total itemized deductions above the standard deduction threshold. Additionally, if you are 70½ or older, a Qualified Charitable Distribution (QCD) from your IRA of up to $111,000 counts as tax-free and satisfies your Required Minimum Distribution (RMD).
CPA Tip: Donor-Advised Funds (DAFs) are an excellent way to bunch charitable contributions. You get the deduction now and can distribute the funds to charities over time.
8. Leverage the Expanded Estate and Gift Tax Exemption
The estate and gift tax exemption has been permanently increased to $15 million per taxpayer (up from $13.61 million). For married couples, this means up to $30 million can pass to heirs federal estate-tax-free.
Even with this higher threshold, proper estate planning remains essential. The annual gift tax exclusion in 2026 is $19,000 per recipient, meaning you can give up to $19,000 to as many individuals as you like — completely tax-free.
CPA Tip: Do not wait for a higher exemption to make your estate plan obsolete. Laws can change. A well-structured plan today protects your family regardless of future legislative shifts.
9. Business Owners: Pay Family Members and Reduce Taxes
If you run a small business, one often-overlooked strategy is placing family members on payroll for legitimate work. By paying a spouse or child reasonable compensation for work they actually perform, you shift income to a lower tax bracket and may reduce your self-employment tax burden.
Children employed by a parent’s sole proprietorship or partnership (between parents) may be exempt from FICA taxes until age 18, adding further savings.
CPA Tip: Compensation must be reasonable and documented. Keep time sheets, job descriptions, and pay records to withstand IRS scrutiny.
10. Review Section 179 and Bonus Depreciation for Business Assets
Business owners purchasing equipment, technology, or other qualifying assets in 2026 should evaluate Section 179 expensing and bonus depreciation. These provisions allow businesses to immediately deduct the full cost of qualifying asset purchases rather than depreciating them over several years.
This can significantly reduce taxable income in the year of purchase — particularly valuable for businesses expecting a strong revenue year.
CPA Tip: Year-end timing matters. Assets must generally be placed in service (not just ordered) before December 31 to qualify for the 2026 deduction.
Start Planning Now — Not in April
The most important piece of CPA tax advice for 2026 is this: tax planning is a year-round discipline, not a once-a-year scramble. The strategies above work best when implemented proactively, with guidance from a qualified professional who understands your full financial picture.
Tax laws are still evolving in 2026. The Department of Treasury is expected to issue additional guidance on several OBBBA provisions throughout the year. Staying on top of these changes — and adjusting your strategy accordingly — is exactly what your CPA is here to do.
Ready to Reduce Your 2026 Tax Bill?
Schedule a consultation with our team today. We will review your situation, identify the deductions and credits you may be missing, and build a customized tax plan designed to keep more money in your pocket.
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