How is You Pay Changing in 2026 from the One Big Beautiful Bill (OBBB)
Hello Single Moms,
Happy New Year! As we step into this new season, I want to make sure you’re aware of some important updates that may affect your finances. Changes from the One Big Beautiful Bill (OBBB), passed by Congress in 2025, take effect on January 1, 2026, and I want to help you understand how these updates may impact you—where applicable.
Below are some of the most important changes being implemented and what they could mean for your paycheck and taxes.
The Standard Deduction Increased — With a Catch
The standard deduction nearly doubled, making tax filing simpler for many households. At the same time, several itemized deductions were removed or limited.
For the 2026 tax year (the year you earn the income and will file your tax return in 2027), the standard deduction amounts are as follows:
$16,100 for single filers (and married filing separately)
$24,150 for head of household filers
$32,200 for married couples filing jointly (and surviving spouses)
In addition, taxpayers who are 65 or older or legally blind may qualify for an additional standard deduction on top of these base amounts.
These higher standard deductions reduce your taxable income, which can mean less federal income tax owed — even if you don’t itemize deductions.
Bottom-line impact:
This change helps single moms with straightforward taxes but can hurt those who previously relied on deductions to lower their tax bill. In many cases, families lost write-offs they depended on, resulting in higher taxable income.
The Child Tax Credit Has No Changes
For the 2026 tax year, the Child Tax Credit (CTC) is structured under the rules currently in effect, therefore, no changes. This means the credit is more limited than many families expect, especially compared to what they may remember from prior years, but this was not as a result of the OBBB.
In 2026:
The Child Tax Credit is up to $2,000 per qualifying child
The amount you receive depends on your income level
A portion of the credit may be non-refundable, meaning it can reduce the taxes you owe but may not result in additional cash back
The credit phases out as income increases, which can reduce or eliminate the benefit for some households
These rules will continue to apply.
Bottom-line impact for single moms:
In 2026, the Child Tax Credit did not change but it will follow what was in place in previous years due to reductions prior to 2025. This makes it especially important not to treat the Child Tax Credit as guaranteed income when planning your budget. Instead, it should be viewed as a potential tax benefit, not a reliable source of spendable money.
Taxes on Tips, Overtime, Car Loan Interest and Social Security
While there were public announcements and proposals suggesting taxes on tips, overtime, Car Loan Interest, and Social Security would be eliminated, these measures were not enacted into law and do not take effect in 2026. This was proposed in the OBBB but has not been signed into law yet to become effective in the January 1, 2026, tax code.
Bottom Line
The OBBB does not dramatically change how income is taxed in 2026. Instead, it increases the importance of understanding withholding, cash flow, and tax planning—because mistakes become more expensive. Make sure to understand with your employer any changes that may impact on your take-home pay and make sure you understand you are ultimately responsible for how you pay, report and file your taxes.