The OBBB makes the nearly doubled standard deduction from the Tax Cuts and Jobs Act (TCJA) permanent. Without this law, the standard deduction would have been dramatically reduced back to pre-TCJA levels (with inflation adjustments).
Additionally, for 2025, the OBBBA increases the standard deduction by 5% across the board. These enhanced amounts will be the base for future annual inflation adjustments.
Standard Deduction in 2025 & 2026
| Standard Deduction | Single/MFS1 | MFJ2/Qualifying Widow(er) | Head of Household |
|---|---|---|---|
| TY 2025 before OBBB | $15,000 | $30,000 | $22,500 |
| TY 2025 under OBBB | $15,750 | $31,500 | $23,625 |
| TY 2026 under OBBB | $16,100 | $32,200 | $24,150 |
As part of making the increased standard deduction permanent, the law permanently repeals the personal exemption allowance that was part of tax calculations prior to 2018. This is a benefit to the vast majority of taxpayers.
For tax years 2025 through 2028, additional deductions are available to taxpayers age 65 and older as part of the OBBB.