2026 Tax Deductions and Refunds: Key Ways to Maximize Your Return

As U.S. taxpayers prepare to file 2026 returns, several changes in tax rules could increase refunds or lower tax bills. Knowing which 2026 tax deductions and refunds are available helps both individuals and families claim every benefit they qualify for and potentially boost their refund amounts.

Higher Standard Deduction for More Filers

For the 2026 tax year, the IRS raised the standard deduction amounts. Single filers can now claim $15,750, while married couples filing jointly can claim $31,500 as their base deduction. These increases — adjusted for inflation and new law enhancements — reduce taxable income for most taxpayers. Taking the standard deduction remains the best choice for nearly 90% of filers.

Expanded SALT Deduction Cap

The controversial state and local tax (SALT) deduction cap has risen from $10,000 to $40,000 for 2026. Taxpayers in high‑tax states may benefit by itemizing instead of taking the standard deduction if their combined state and local tax payments exceed the standard amount.

Extra Deduction for Seniors 65 and Older

Taxpayers age 65 or older can claim a new $6,000 bonus deduction in addition to the standard deduction, and a couple where both spouses qualify can claim up to $12,000. This extra break is available even if you don’t itemize, although it phases out at higher income levels.

New Above‑The‑Line Deductions

New deductions for 2026 tax filing include qualified overtime pay and tip income — with eligible amounts deductible regardless of whether you itemize. Additionally, taxpayers who bought a new vehicle in 2026 may deduct up to $10,000 in interest paid on the loan for personal use. These provisions help reduce taxable income and potentially increase refunds.

Child Tax Credit and New Accounts

Families with children can benefit from an enhanced Child Tax Credit, offering up to $2,200 per qualifying child. A new government‑backed savings account also gives a $1,000 federal contribution for eligible children born from 2026 through 2028, potentially affecting tax planning and savings strategies.

Itemize or Not? Making the Best Choice

While most filers use the higher standard deduction, itemizing may pay off if total eligible deductions — including SALT, mortgage interest, charitable contributions, medical expenses, and other breaks — exceed the standard deduction. Careful review of itemized deductions can lead to lower taxable income and a larger refund.

Conclusion

Understanding 2026 tax deductions and refunds gives taxpayers an edge when filing returns. With an expanded standard deduction, higher SALT caps, new senior breaks, and additional above‑the-line deductions, more filers can take home larger refunds or owe less tax. Planning ahead, reviewing eligibility, and choosing the right deduction strategy helps ensure you capture every available tax benefit.