The Core of the Tax Code Will Change, but We Don't Know How

Navigating the complex U.S. tax rules and completing your return may be enough of a headache. But fresh tax stress is looming from Washington. On Dec. 31, 2025, key parts of the 2017 federal tax law are set to expire. After that, they would revert to their pre-2017 state. This means that core aspects of the tax code will be up for debate, including tax rates, standard deductions, treatment of business income, exemption limits, and the federal deduction for state and local taxes. If Congress takes no action, the tax code in 2026 would suddenly shift to its pre-2017 form, creating significant financial burdens for taxpayers. Additionally, provisions for future inflation adjustments will need to be accounted for, making it difficult to estimate important numbers such as federal tax brackets. Simply maintaining the current tax code is not feasible due to its high cost. The Congressional Budget Office has estimated that extending all provisions would cost $3.5 trillion by 2033.