The 2025 tax season is officially in full swing, and if you’re already knee-deep in, you know that uncertainty is at an all-time high. Many taxpayers are not only focused on their 2024 returns, but they’re also looking ahead and wondering how upcoming tax law changes might impact their financial future.

One of the biggest sources of concern is the expiration of key provisions from the Tax Cuts and Jobs Act (TCJA) at the end of 2025. Several taxpayer-friendly benefits will disappear without new legislation, potentially leading to higher tax liabilities.

So, what should tax pros be paying attention to?

The standard deduction: If Congress doesn’t extend the current TCJA provisions, the standard deduction will shrink back to pre-2018 levels, meaning more taxpayers may now itemize.

Individual tax rates: The lower tax brackets introduced under the TCJA are set to expire, meaning clients could face higher tax bills starting in 2026 as rates revert to their pre-TJCA levels.

The child tax credit (CTC): One of the most significant benefits for families, the enhanced CTC could be rolled back, reducing the amount of relief available to taxpayers with dependents.

For tax professionals, now is the time to start conversations with clients about potential planning opportunities. While immediate action may not be necessary, being proactive in discussing what’s ahead can help build trust, minimize surprises, and allow for more strategic tax planning. Here are some charts to help you explain the upcoming changes to your clients. We end with a hypothetical scenario that illustrates the impact of some of these changes.

Standard deduction

The basic standard deduction for 2024-2026 are as follows:

Filing Status	2024	2025	2026 (projected)
Married filing joint (MFJ) and surviving spouse (SS)	$29,200	$30,000	$16,700
Single (S) and married filing separately (MFS)	$14,600	$15,000	$8,350
Heads of household (HOH)	$21,900	$22,500	$12,250

The projected standard deduction would be roughly half of what it is currently. While this could lead many taxpayers to itemize their deductions, for some, their total itemized deductions might be lower than the standard deduction under the TCJA.

Individual tax rates

Below are the marginal tax rates for 2024-2026:

Marginal Tax Rates

2024 and 2025	2026 (revert to permanent pre-TCJA levels)
10%	10%
12%	15%
22%	25%
24%	28%
32%	33%
35%	35%
37%	39.6%

When tax planning, it is important to remember that income tax rates are applied progressively through marginal tax brackets. Each portion of a taxpayer’s income is taxed at different rates depending on which bracket it falls into. Understanding this structure is important, as with planning, one can estimate their tax burden more accurately and explore ways to manage or reduce their taxable income.

Child tax credit

The TCJA’s enhanced CTC rules are still in effect for tax years 2024 and 2025. After tax year 2025, the pre-2018 CTC rules will again apply unless changed by legislation.

Below is a chart that illustrates high-level CTC details for tax years 2024-2026:

Tax Year	Child Tax Credit	Income Phaseout	Other Dependent Credit (ODC)
2024 and 2025	$2,000 per qualifying child	MFJ: the total credit is reduced by $50 for every $1,000 of income (or part of a $1,000) by which the taxpayers’ MAGI exceeds $400,000; $200,000 for all other filers	$500 per qualifying dependent; Same phaseout based on MAGI as $2,000 CTC
2026	$1,000 per qualifying child	$110,000 for MFJ; $75,000 for S, HOH, QSS $55,000 MFS	The ODC will not apply

What will happen in 2026?

The Tax Foundation, a leading nonpartisan tax policy nonprofit, estimates that if the individual provisions of the TCJA are made permanent, about 62% of filers would see a tax reduction, 29% would experience no change, and just under 9% would face a tax increase in 2026. To help tax professionals and their clients better understand the potential impact of these changes, the Tax Foundation has developed an educational tool that allows users to compare the effects of extending or letting TCJA provisions expire.

Hypothetical scenario

Kavya and Nick are typical taxpayers. They are a married couple with two kids under the age of 17 at the end of the year and, therefore, eligible for the CTC. For comparison purposes, we included the 2024 tax year, which would be similar to 2025, except for inflation adjustments. The table below summarizes what their tax situation would look like under the different scenarios.

Line Item	2024	TCJA Made Permanent	TCJA Expires
Adjusted gross income (AGI)	$79,500	$79,500	$79,500
Standard deduction	$29,200	$30,600	$16,600
Personal exemption	N/A	N/A	$21,200
Taxable income (A)	$50,300	$48,900	$41,700
Tax	$5,575	$5,381	$5,043
Child tax credit	$4,000	$4,000	$2,000
Total tax (B)	$1,575	$1,381	$3,043
Marginal tax rate	12%	12%	15% (projected)
Effective tax rate *(B/A)	3.1%	2.8%	7.3%

*The effective rate is the average rate the taxpayer pays on their taxable income. It is calculated by dividing the total tax by the taxable income. The scenario under which the TCJA expires assumes a standard deduction. The results would be different if the taxpayer’s itemized deduction exceeded the standard deduction. Also, the tax brackets widen yearly to keep up with inflation.

As the various scenarios indicate, the CTC reverting to its previous lower amount can significantly impact the total tax paid by families with younger children. While the future of the CTC is uncertain, several proposals are on the table, including the TCJA Permanency Act (H.R. 137), which extends the TCJA’s expiring provisions. If you haven’t yet, join NATP for up-to-date information and updates delivered straight to your email inbox so you can stay focused on serving your clients with excellence.