Most Americans Think They Know All Their Tax Deductions for 2026 — Do You?
Unless you filed a tax extension, you’ve likely already taken care of your 2025 tax return and received your refund. That means it’s time to start thinking about what your 2026 taxes could look like and how you can minimize how much you owe Uncle Sam.
For most Americans who have spent years paying taxes, it can feel like they have a good understanding of all the tax deductions they’re eligible for. Unfortunately, the U.S. tax code changes yearly and tax deductions come and go. This makes it difficult to know whether you’re really maximizing your deductions or just think you are.
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Here are three tax deductions you might be missing without even realizing it.
Qualified Tips and Overtime Deductions
One of the biggest recent changes, which took effect in 2025 (taxes filed in 2026), was related to tips and overtime pay.
Any worker in a position that makes a majority of their income from tips can deduct up to $25,000 of those tips. What makes this deduction even more attractive is that it’s above-the-line, meaning you don’t need to itemize your taxes to take advantage.
For employees who work a significant amount of overtime, you’ll be able to deduct up to $12,500 ($25,000 for married couples filing jointly) in overtime pay.
Millions of Americans may qualify for those deductions without fully understanding how they work.
“Both the qualified tip and qualified overtime deductions come with annual caps and income-based phaseouts,” said Blake Rudy, Associate, Wealth Advisory Services at Fairway Wealth Manager. “Both benefits begin to phase out once a single filer's Modified Adjusted Gross Income exceeds $150,000 or $300,000 if filing jointly.”
Qualified Charitable Distributions (QCDs)
One of the more complex tax situations as you get older is understanding how to properly take the required minimum distributions (RMDs) from your retirement accounts.
Qualified charitable distributions have become a way for high-net-worth individuals to make charitable contributions from their retirement accounts that count toward their required annual distributions.
“This is far superior to taking the RMD, paying tax on it and then donating the after-tax amount,” said Steven Kao, MBA, CAIA and director of portffolio management at Kirsner Wealth Management. “Particularly valuable for high-income retirees whose Social Security benefits or Medicare premiums are income-sensitive.”
Above-the-Line Charitable Deduction
In the past, deducting charitable contributions required itemizing your tax return. Since the standard deduction was increased as part of the Tax Cuts and Jobs Act of 2017, most people have taken the standard deduction, making charitable giving less attractive.
Starting in 2026, you can use the standard deduction and still claim a charitable deduction of up to $1,000 for single filers and $2,000 for married filing jointly.
This means that, for the first time in years, millions of Americans are eligible to reduce their taxable income by making cash contributions to eligible charities.
“Roughly one out of 10 taxpayers itemize their deductions. This new code has potential to motivate more people to make contributions to causes they care about,” said Rudy.
This article was provided by MoneyLion.com for informational purposes only and should not be construed as financial, legal or tax advice.
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