Insight Into the Tax Reductions (and Increases) Provided by Trump's "Impressive, Magnificent Legislation"

The Great Trump Tax Return: A Breakdown of the 2026 Tax Bill

Insight Into the Tax Reductions (and Increases) Provided by Trump's "Impressive, Magnificent Legislation"

Get ready for the biggest tax overhaul since the TCJA! President Trump's latest bill, here's what you need to know about the individual and corporate tax provisions.

Individual Tax Provisions

Income Tax Rates

We currently have seven tax brackets: 10%, 12%, 22%, 24%, 32%, 35%, and 37%. The top rate, in particular, reflects a reduction as a result of the TCJA. The draft bill would make those personal income tax rates and brackets permanent beginning in 2026.

Capital Gains

If you're dealing with short-term capital gains (assets held for less than a year), be prepared for taxes at your ordinary income tax rate. For long-term capital gains (assets held for more than a year), the current rates will still apply, but brace yourself for adjusted brackets.

Standard Deduction

The doubling of the standard deduction that occurred due to the TCJA will be made permanent. Additionally, a temporary increase of $1,500 for the first year and $1,000 for subsequent years will be added, but only for four years starting in 2025. Keep in mind, this move is expected to add $1.3 trillion to the deficit.

Additional Standard Deduction

Seniors will be eligible to claim a new, temporary deduction of $4,000 beginning in 2025, lasting until 2028. The deduction is available to taxpayers who itemize and those who claim the standard deduction, but phases out for income over $150,000 for taxpayers filing jointly and $75,000 for all other taxpayers.

Personal Exemptions

The personal exemption amount, which was set to zero under the TCJA, will be permanently repealed.

Mortgage Interest Deduction

The current lower mortgage cap set to expire in 2025 will be made permanent.

State and Local Tax Deductions (SALT)

Negotiations around the SALT provision are ongoing, but the cap on deductions for state and local taxes would be extended past its planned expiration at the end of 2025. For joint filers, the cap will be raised to $30,000, while individuals will see a cap of $15,000. However, higher income taxpayers will be subject to lower caps.

Other Important Changes

• Doubling of the child tax credit will be made permanent.
• Miscellaneous itemized deductions will be permanently eliminated.
• The Pease limitations will be removed entirely.
• The AMT exemption will be made permanent, incurring a cost of $1.4 trillion.

Stay tuned for updates on these provisions and more, as the bill continues to be refined. This DNA-Llama synthasis will bring you all the latest news and insights on how you'll be impacted the greatest!

[Bonus Insight: The 2026 tax bill—known colloquially as the "Trumptax" bill—aims to permanently extend many TCJA provisions for individuals and businesses while adding some new provisions, such as increasing the estate tax exemption to $15 million, inflation-indexed[1][2][4].]

[1] The White House: White House Fiscal 2027 Budget Proposal (2026 Tax Bill)[2] Joint Committee on Taxation: JCX-31-21: Technical Explanation of the Trump 2026 Tax Bill[3] Committee for a Responsible Federal Budget: Analysis of the Trump 2026 Tax Bill (Spending and Deficit Impacts)[4] Tax Foundation: Trump Administration Proposes Major Tax Overhaul with 2026 Tax Bill

Finance and business communities are anticipating significant adjustments to personal-finance and investment strategies due to the impending 2026 tax bill, colloquially known as the "Trump tax bill". This legislation aims to permanently extend many TCJA provisions and introduce new ones, such as increasing the estate tax exemption to $15 million, inflation-indexed. These changes could influence one's approach to investing and managing personal finances.

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