Every year the IRS adjusts its numbers for inflation — and 2026 is no different.
The IRS has officially released its updated standard deduction amounts for 2026, and for California taxpayers across Los Angeles County and beyond, this update could directly impact how much you owe — or how big a refund you walk away with.
At ABSE Tax in Artesia, CA, we help thousands of individuals and businesses across more than 50 cities in and around Los Angeles understand exactly how IRS changes affect their bottom line. Let’s break this down in plain language.
What Is the Standard Deduction — and Why Does It Matter?
Before we get to the numbers, let’s quickly cover the basics.
When you file your federal tax return, you can reduce your taxable income in one of two ways:
- Take the standard deduction — a flat dollar amount set by the IRS that anyone can claim without tracking expenses
- Itemize your deductions — add up individual deductions like mortgage interest, charitable giving, and medical expenses
Most people take the standard deduction because it’s simpler and, for most filers, it’s actually larger than what they’d get by itemizing. That’s especially true after the Tax Cuts and Jobs Act of 2017 nearly doubled the standard deduction.
The IRS standard deduction 2026 amounts went up again because of inflation adjustments — meaning you can shield more of your income from federal taxes.
New IRS Standard Deduction Amounts for 2026
Here are the updated figures for the 2025 tax year, which you file in 2026:
| Filing Status | 2025 Standard Deduction (Filed in 2026) | 2024 Standard Deduction | Increase |
|---|---|---|---|
| Single | $15,000 | $14,600 | +$400 |
| Married Filing Jointly | $30,000 | $29,200 | +$800 |
| Married Filing Separately | $15,000 | $14,600 | +$400 |
| Head of Household | $22,500 | $21,900 | +$600 |
Additional Deductions If You’re 65+ or Blind
If you’re 65 or older, or legally blind, you get an additional amount stacked on top:
- Single or Head of Household: +$2,000
- Married: +$1,600 per qualifying person
So a married couple where both spouses are 65+ can claim: $30,000 + $1,600 + $1,600 = $33,200
What This Means for California Taxpayers Specifically
Here’s the thing — the IRS standard deduction only applies to your federal return.
California has its own much lower standard deduction through the Franchise Tax Board (FTB):
| Filing Status | California Standard Deduction 2026 |
|---|---|
| Single | $5,202 |
| Married Filing Jointly | $10,404 |
| Head of Household | $5,202 |
That’s a massive difference. Because California’s standard deduction is so low, many California residents — especially homeowners in the Los Angeles area — actually benefit from itemizing on their state return, even if they take the federal standard deduction.
This is one of the most overlooked tax strategies in California. You can take the standard deduction federally AND itemize on your California state return — they’re filed separately.
Items that commonly make itemizing worthwhile on your California return:
- Mortgage interest — LA-area home values are high, meaning bigger interest payments
- Property taxes — California property taxes on LA County homes can easily exceed $5,000/year
- Charitable contributions — significant donations can tip the scale
- Large medical expenses — exceeding 7.5% of your Adjusted Gross Income
IRS Inflation Adjustments Beyond the Standard Deduction
The standard deduction isn’t the only thing that changed for 2026. The IRS updated dozens of figures. Here are the key ones affecting most Los Angeles area filers:
Updated Federal Tax Brackets for 2026
| Tax Rate | Single Filer Income | Married Filing Jointly |
|---|---|---|
| 10% | Up to $11,925 | Up to $23,850 |
| 12% | $11,926 – $48,475 | $23,851 – $96,950 |
| 22% | $48,476 – $103,350 | $96,951 – $206,700 |
| 24% | $103,351 – $197,300 | $206,701 – $394,600 |
| 32% | $197,301 – $250,525 | $394,601 – $501,050 |
| 35% | $250,526 – $626,350 | $501,051 – $751,600 |
| 37% | Over $626,350 | Over $751,600 |
With LA-area salaries trending higher, knowing your bracket helps you plan smart — whether that means maxing out retirement contributions or timing major deductions.
Updated Contribution Limits for 2026
| Account | 2026 Limit |
|---|---|
| 401(k) / 403(b) Employee Contribution | $23,500 |
| 401(k) Catch-Up (Age 50+) | +$7,500 |
| IRA (Traditional or Roth) | $7,000 |
| IRA Catch-Up (Age 50+) | +$1,000 |
| HSA — Self-Only Coverage | $4,300 |
| HSA — Family Coverage | $8,550 |
Every dollar you contribute to a 401(k) or traditional IRA is a dollar that reduces your taxable income right now. For LA-area earners in the 22–32% brackets, this is one of the most powerful legal tax reduction tools available.
Updated Standard Mileage Rate
The IRS also updates the standard mileage rate used by self-employed individuals and business owners to deduct vehicle use:
- Business mileage: 70 cents per mile (2025 rate, filed in 2026)
If you’re a contractor, delivery driver, rideshare driver, real estate agent, or any profession that involves driving for work anywhere in LA County — track every mile. It adds up fast.
Should You Take the Standard Deduction or Itemize in 2026?
This is the #1 question we get at ABSE Tax every season. The answer depends on your individual situation, but here’s a quick guide:
You should probably take the federal standard deduction if:
- You rent your home (no mortgage interest deduction)
- Your total itemized deductions are less than $15,000 (single) or $30,000 (married)
- You don’t have major medical expenses, large charitable gifts, or investment losses
- You want a simpler filing process
You should probably itemize federally if:
- You own a home in an LA-area city with a significant mortgage and property tax bill
- You made large charitable donations to qualified organizations
- You had significant unreimbursed medical expenses (over 7.5% of AGI)
- You have substantial state income tax deductions (note: SALT is capped at $10,000 federally)
Always run the comparison on your California return separately
Because California’s standard deduction is so low ($5,202), the math often favors itemizing on your state return even when you don’t federally. A professional tax preparer will run both scenarios and choose what saves you the most.
How This Affects Business Owners in Los Angeles
If you’re a business owner — LLC, S-Corp, sole proprietor, or freelancer — the standard deduction conversation is different for you.
Business income is reduced by business deductions, not by the standard deduction. Your standard deduction applies to your personal taxable income after business deductions are already subtracted.
This means:
- If you’re self-employed in Los Angeles, maximizing your Schedule C business deductions is the first priority — home office, equipment, software, vehicle mileage, professional services, advertising
- After that, the standard deduction further reduces your personal income
- Then retirement contributions (SEP-IRA, Solo 401k) can lower your income even further
Done right, a self-employed individual in LA County can legally reduce tens of thousands of dollars in taxable income. This is where working with a professional tax advisor like ABSE Tax makes a significant financial difference.
Serving Taxpayers Across 50+ Cities in the Los Angeles Area
These IRS updates affect every taxpayer — whether you’re in the heart of Los Angeles or in the suburbs of Southeast LA County. ABSE Tax serves clients across all the following cities and communities:
Southeast Los Angeles County Artesia · Cerritos · Norwalk · Hawaiian Gardens · Lakewood · Bellflower · Paramount · Downey · South Gate · Lynwood · Cudahy · Bell Gardens · Bell · Maywood · Huntington Park · Compton · Gardena · Hawthorne · Carson · Torrance
Long Beach & South Bay Long Beach · Signal Hill · Redondo Beach · Lawndale · Lomita · Harbor City · Wilmington · San Pedro · Rancho Palos Verdes · Rolling Hills Estates · Inglewood · El Segundo · Manhattan Beach · Hermosa Beach
East Los Angeles & San Gabriel Valley Pico Rivera · Whittier · La Mirada · Santa Fe Springs · Montebello · Commerce · East Los Angeles · Monterey Park · Rosemead · Temple City · El Monte · South El Monte · Baldwin Park · West Covina · Covina
Central & Greater Los Angeles Los Angeles (all neighborhoods) · Culver City · Inglewood · Vernon · Boyle Heights · East LA · Koreatown · Alhambra · Arcadia · Pasadena · Glendale · Burbank
Orange County Border Cities Anaheim · Buena Park · La Palma · Cypress · Garden Grove · Stanton · Placentia
No matter which city you’re in, our secure online document portal means you can work with ABSE Tax without ever leaving your home. Upload your documents, we handle the rest.
Frequently Asked Questions
Q: Does the new IRS standard deduction apply to my California state return? No. California uses its own standard deduction through the FTB — $5,202 for single filers and $10,404 for married filing jointly in 2026. These are completely separate from federal amounts.
Q: I own a home in Los Angeles. Should I itemize? Likely yes on your California return, and possibly on your federal return too depending on your mortgage, property taxes, and other deductions. A tax professional can run both scenarios for you in minutes.
Q: I’m self-employed in LA. How does the standard deduction work for me? You first deduct all business expenses on Schedule C, reducing your net self-employment income. Then the standard deduction applies to your remaining personal taxable income. You can also deduct half of self-employment tax and retirement contributions before the standard deduction kicks in.
Q: My income is high. Can I still claim the full standard deduction? Yes — unlike some deductions, the standard deduction is not phased out based on income. However, high-income earners may face the Alternative Minimum Tax (AMT), which has its own exemption amounts. Ask your tax advisor if AMT applies to you.
Q: Is there a deadline to decide whether to itemize or take the standard deduction? You make this decision when you file your return. There’s no advance election required. Your tax preparer will calculate both options and choose whichever results in lower taxes.
Related Posts From ABSE Tax
Before you file, catch up on our complete 2026 tax series:
📌 2026 Tax Deadlines for California Individuals & Businesses — Complete Federal and State Guide Everything you need to know about April 15, quarterly estimated taxes, business deadlines, and California FTB dates.
📌 Tax Filing Season 2026 Has Started in the U.S. — Everything You Need to Know Before You File What documents to gather, what’s new for 2026, and why filing early is always the smarter move.
📌 Tax Filing Services in California — What You Should Know Before Filing in 2026 How ABSE Tax serves 50+ cities across Los Angeles County with professional, personalized tax filing.
Ready to File Smarter in 2026?
Understanding the new IRS standard deduction amounts is one piece of the puzzle. Making sure you’re filing correctly, claiming every deduction you’re entitled to, and not overpaying California taxes — that’s where ABSE Tax comes in.
We serve individuals, families, self-employed filers, and businesses across more than 50 cities in and around Los Angeles. Whether you walk in to our Artesia office or upload your documents online from Downey, Long Beach, Norwalk, Cerritos, or anywhere in LA County — we’ve got you covered.
📞 562-403-1177 📧 info@absetax.com 📍 18000 Pioneer Blvd, Artesia, CA 90701
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