Proactive midyear tax planning helps high-income earners navigate 2026 brackets under the One Big Beautiful Bill Act (OBBBA). Strategies include accelerating itemized deductions, managing capital gains, and bunching medical expenses to lower adjusted gross income, minimizing overall tax liability and preventing year-end surprises.
High-income taxpayers often feel exposed to surprise liabilities when tax strategy is treated as a reactive, once-a-year event. Summer is the ideal time to review your income, deductions, and investment activity to ensure everything aligns with your broader financial goals. Taking action now gives you a clear picture of your tax liability and provides the runway to fix issues before the year closes. Let us look at a few areas that commonly provide tax-saving opportunities.
Navigating 2026 Tax Brackets and the OBBBA
The One Big Beautiful Bill Act (OBBBA) retained federal income tax rates ranging from 10% to 37%. You need to monitor your marginal rate, which is the rate that applies to your next dollar of income after deductions and exclusions. If you expect this year’s income to approach the threshold for a higher bracket, you can implement strategies to reduce your taxable income.
For 2026, the 37% bracket begins at $640,601 for single filers and $768,701 for married couples filing jointly.
When to Accelerate or Delay Itemized Deductions
Carefully review how the OBBBA impacts your deductions this year. The standard deduction remains high for 2026 at $16,100 for singles, $24,150 for heads of household, and $32,200 for joint filers. Itemizing only saves you taxes if your total itemized deductions exceed those thresholds.
The OBBBA shifted the landscape for specific deductions:
State and local tax deductions now offer greater potential benefits.
Charitable deductions are more limited.
New deductions exist for qualified tips, overtime, taxpayers over 65, and qualified auto loan interest.
Managing Medical Expenses and the AGI Floor
You can deduct medical expenses that exceed 7.5% of your adjusted gross income (AGI). If you expect to benefit from itemizing on your 2026 return and are close to this floor, controlling the timing of medical expenses is a powerful tool.
Deductible medical expenses include:
Health insurance premiums.
Long-term care insurance premiums.
Medical and dental services.
Prescription drugs.
Mileage driven for health care purposes.
You can bunch additional expenses into 2026 to exceed the floor and maximize your deduction. Alternatively, if you are far from the 7.5% threshold, you may want to delay those expenses until 2027. Your family’s health remains the priority, so never delay necessary medical care for tax savings. Always consider how timing affects your health insurance coverage, especially if you hold a high-deductible plan.
Offsetting Investment Gains and the Wash Sale Rule
The OBBBA maintained long-term capital gains rates at 0%, 15%, and 20% for investments held more than one year. Short-term gains face your ordinary-income tax rate, which is substantially higher. The top long-term gains rate of 20% kicks in at $545,501 for singles and $613,701 for joint filers.
If you expect significant capital gains this year, consider selling depreciated investments to generate losses. These losses can offset your gains. You can even repurchase those investments later, provided you wait at least 31 days to avoid the wash sale rule.
High-income earners must also plan for the 3.8% net investment income tax (NIIT). This tax impacts single taxpayers with a modified AGI over $200,000 and joint filers over $250,000. Reducing your modified AGI or your net investment income can effectively lower this liability.
Partner with The CJ Group for Year-Round Tax Strategy
Planning opportunities disappear as the end of the year approaches. The CJ Group provides proactive, personalized tax planning that coordinates with your broader wealth picture, ensuring decisions are made with the tax impact in view year-round. We work alongside high-net-worth families to protect wealth and keep compliance clean from end to end.
If you are tired of April surprises and want proactive guidance, reach out to our team to discuss your personal income tax strategy today.
© 2026
