The IRS has revealed Tax Brackets for 2026, take a look here as well as some insights in light of the "Big Beautiful Bill".
| Tax Rate | Single | Head of Household | Married Filing Jointly |
| 10% | Taxable income up to $12,400 | Taxable income up to $17,700 | Taxable income up to $24,800 |
| 12% | $12,401 - $50,400 | $17,701 - $67,450 | $24,801 - $100,800 |
| 22% | $50,401 - $105,700 | $67,451 - $105,700 | $100,801 - $211,400 |
| 24% | $105,701 - $201,775 | $105,701 - $201,775 | $211,401 - $403,550 |
| 32% | $201,776 - $256,225 | $201,776 - $256,200 | $403,551 - $512,450 |
| 35% | $256,226 - $640,600 | $256,201 - $640,600 | $512,451 - $768,700 |
| 37% | $640,601 and higher | $640,601 and higher | $768,701 and higher |
Here are two key take-aways:
1. The elective deferral limit for 401(k)/403(b) plans rises to $𝟐𝟒,𝟓𝟎𝟎 in 2026 (up from $23,500 in 2025).
2. The new Roth catch-up contribution requirement starts 𝐉𝐚𝐧 𝟏, 𝟐𝟎𝟐𝟔: employees with 2025 FICA wages over $𝟏𝟓𝟎,𝟎𝟎𝟎 must use Roth for catch-up contributions.
What this means for your plan:
• Business owners: Review your retirement plan communications to make sure participants know the higher limits.
• Check your payroll systems & contribution setups to ensure the $150K wage-threshold is built in.
• Encourage eligible participants (especially age 50+) to revisit their contribution strategy ahead of 2026.
Fermata Tax is here if you have any questions! Click HERE to learn more.
