/images/2023/09/14/woman_using_laptop.jpg)
/images/2019/12/06/smart_strategies_to_save_money_on_car_insurance.jpg)
:format(webp)/images/2025/09/22/a-person-holding-a-us-treasury-tax-refund.jpg)
/authors/josh-koebert-headshot_fevhyqJ.jpg)
/authors/becca-headshot.jpg)
Add Us On Google
If you received a larger-than-expected tax refund this year, you may be wondering if you filed correctly. The changes stem from the One Big Beautiful Bill Act (OBBBA) passed last year. Supporters argue certain tax changes will help you keep more of what you earn, though the details matter. For many households, the size of a refund may depend on how you filed your return.
Here's what taxpayers should know about filing extensions or filing for the next tax year, so you can keep more cash in your wallet.
Now Available: The Definitive Guide to Retirement Income
Many successful investors eventually reach the same moment. The saving is done, the portfolio is built, and the question quietly changes from how much can I grow this to how much can I take out? Get that second question wrong and decades of good investing can come apart in a handful of years.
That is exactly what The Definitive Guide to Retirement Income helps answer.1 <p class="">Investing in securities involves a risk of loss. Past performance is never a guarantee of future returns. Investing in foreign stock markets involves additional risks, such as the risk of currency fluctuations. Guides are provided by Fisher Investments. The publisher may be compensated when readers request a guide.</p> It covers what your retirement could actually cost, which income sources are worth using, and the withdrawal math that decides whether the money lasts. It is free today from Fisher Investments. Read More Here ›
How to get a bigger tax refund under new IRS rules
Several provisions in the One Big Beautiful Bill Act may increase refunds for eligible taxpayers, particularly those with wages tied to tips, overtime, or higher deductions. According to the nonpartisan Tax Foundation, the average filer could see refunds rise by roughly $300 to $1,000 compared with the previous year.
That increase assumes taxpayers actively claim deductions they qualify for and file accurately. Many of the new benefits have income caps, making careful preparation essential.
It's also important to note that, in addition to certain tax law changes, the IRS is also moving away from paper checks as part of a broader federal effort to modernize payments. Under a recent executive order, most government payments will shift to electronic delivery, with limited exceptions. To receive a refund as quickly as possible, the IRS recommends choosing direct deposit when filing. Paper checks could result in longer processing times, especially during peak filing season.
New standard deduction limits
The standard deduction increased again for the 2026 filing season, reducing taxable income for millions who do not itemize. Single filers and married individuals filing separately can now deduct $16,100, which is $350 more than the prior year. Married couples filing jointly receive a deduction of $32,200, reflecting a $700 increase.
Higher standard deductions can automatically lower tax bills, but they may also reduce the advantage of itemizing. Taxpayers should still compare both options to determine which yields the lowest overall tax liability.
No tax on tips
Workers in occupations that traditionally rely on tipping may see meaningful relief under the new rules. From 2025 through 2028, eligible employees and self-employed individuals can deduct qualified tips received from customers, including shared tips. The deduction is capped at $25,000 per year and applies only to jobs the IRS has designated as customarily receiving tips.
This benefit phases out once modified adjusted gross income (MAGI) exceeds $150,000 for single filers or $300,000 for joint filers. Tips must still be reported as income, but the deduction can significantly reduce the amount of that income that is taxed.
Released: The Definitive Guide to Retirement Income (Sponsor)
Most people spend their entire working lives focusing on one thing: growing a pile of money. Then they retire and discover the skill they actually need is close to the opposite. Turning that pile into steady income, year after year, through good markets and bad, without ever running out. It may be the least discussed and most consequential transition in personal finance, and plenty of otherwise careful investors walk into it with no real plan.
That is exactly what The Definitive Guide to Retirement Income helps answer.1 <p class="">Investing in securities involves a risk of loss. Past performance is never a guarantee of future returns. Investing in foreign stock markets involves additional risks, such as the risk of currency fluctuations. Guides are provided by Fisher Investments. The publisher may be compensated when readers request a guide.</p> It is a free guide from Fisher Investments covering what your retirement will really cost, where the cash flow should come from, and how much you can safely withdraw each year. Learn More Here ›
No tax on overtime
Overtime pay also receives favorable treatment under the updated law. Taxpayers may deduct the portion of overtime compensation that exceeds their regular hourly rate, such as the additional "half" in time-and-a-half pay. The annual deduction is limited to $12,500 for single filers and $25,000 for joint filers.
To qualify, overtime earnings must be properly reported on a W-2, 1099, or similar statement. Similarly, this benefit also phases out once MAGI exceeds $150,000 for single filers or $300,000 for joint filers.
New SALT deductions
The cap on state and local tax (SALT) deductions increased substantially for those who itemize. Eligible taxpayers can now deduct up to $40,000 in state and local taxes, or $20,000 if married filing separately. This represents a sharp jump from the previous $10,000 limit.
The expanded deduction phases out for taxpayers with MAGI above $500,000, or $250,000 for separate filers. Residents of high-tax states may benefit the most from this change, particularly homeowners with significant property tax bills.
New senior deduction
Older Americans received an additional tax break under the legislation. From 2025 through 2028, individuals age 65 and older can claim an extra $6,000 deduction on top of the existing senior standard deductions. Married couples may deduct up to $12,000 if both spouses qualify.
This deduction begins to phase out at a MAGI of $75,000 for individuals and $150,000 for joint filers. For retirees on fixed incomes, the added deduction can meaningfully reduce taxable income.
Why claiming deductions matters
The expanded deductions only help if taxpayers actively claim them. Each provision has specific eligibility rules, income thresholds, and documentation requirements. Missing even one deduction could result in paying more tax than necessary.
Working with a tax professional or using reputable tax software can help ensure all applicable benefits are included and correctly reported.
Bottom line
The 2026 tax season introduces expanded deductions that could push refunds higher for many households, particularly workers, seniors, and residents of high-tax states. While the IRS has made changes to simplify some aspects of filing, the growing number of deductions makes accuracy more important than ever.
Understanding which provisions apply to your situation, adjusting how you file, and planning ahead may help you get ahead financially while taking full advantage of the latest tax law changes.
More from FinanceBuzz:
- Retire like the rich: 14 ways you could build wealth in your 50s.
- Find out if you could pay less for car insurance in just a few clicks.
- Make these 7 savvy moves when you have $1,000 in the bank.
- 14 moves seniors could benefit from but often forget about.
/images/2021/04/21/adobestock_192812280_1200x628.jpg)
/images/2019/12/06/smart_strategies_to_save_money_on_car_insurance.jpg)
/images/2025/01/28/adobestock_628402894_1.jpeg)
/images/2024/09/04/adobestock_669069249_editorial_use_only_1.jpeg)
/images/2020/03/02/tattoo-woman-bar.jpeg)
/images/2020/12/21/smiling-couple-looking-at-laptop-screen.jpeg)
Intro Offer
UNLIMITED CASHBACK MATCH: Discover will automatically match all the cash back you’ve earned at the end of your first year! There’s no minimum spending or maximum rewards. You could turn $150 cash back into $300. Click Apply Now to view important rates and disclosures. Plus, receive a $200 statement credit when you spend $500 on purchases in your first 3 months of account opening
Annual Fee $0 Why we like it
/images/2025/01/23/discover_it_cash_back_card_art_gold.png)
/images/2022/04/20/senior-couple-happy-laptop-computer.jpg)
/images/2022/02/04/woman_with_lottery_ticket.jpg)
/images/2021/05/05/happy-young-investor.jpg)
/images/2025/10/30/couple-looking-at-bills-happy.jpg)
/images/2024/01/10/young-woman-paying-bills-using-laptop.jpeg)
/images/2024/10/24/1040-us-individual-income-tax-return-form.jpeg)
/images/2024/04/16/medical-paperwork.jpg)
/images/2025/09/29/senior-couple-with-financial-advisor.jpg)
/images/2025/06/05/salem_oregon.jpg)
/images/2024/04/21/managing-bank-finances-calculating-taxes.jpg)
/images/2026/01/05/asian-woman-riding-the-train.jpg)
